Accountability Report 2011

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ACCOUNTABILITY
REPORT
2011

ACCOUNTABILITY
REPORT
2011

His Highness Sheikh Khalifa bin Zayed Al Nahyan
President of the United Arab Emirates
Accountability Report 2011

His Highness General Sheikh Mohamed bin Zayed Al Nahyan
Crown Prince of Abu Dhabi, Deputy Supreme Commander of
the UAE Armed Forces
Accountability Report 2011

Accountability
Report
Accountability Report 2011

CONTENTS
09FOREWORD
PART ONE 10
OVERVIEW
1.1 Mandate and Strategic Pillars
1.2 Subject Entities and Functions
1.3 Organization Structure
1.4 Prioritizing Work
1.5 Outcomes
1.6 Accountability and Governance
1.7 People
PART THREE 34
2010 REPORT AND 2011 WORK PLAN
3.1 2010 Highlights
3.2 Output Group 1: Financial Audit and Examination
3.3 Output Group 2: Performance and Risk Assurance
3.4 Output Group 3: Supporting Accountability
3.5 Output Group 4: Special Examination
3.6 Output Group 5: ADAA Training Center
3.7 2011 Work Plan
PART TWO 22
OUTPUT GROUPS
2.1 Financial Audit and Examination
2.2 Performance and Risk Assurance
2.3 Supporting Accountability
2.4 Special Examination
2.5 ADAA Training Center
PART FOUR 56
2010 AUDITED
FINANCIAL STATEMENTS

Accountability Report 2011
H.E. Riyad Al Mubarak
Chairman

Foreword
With great pleasure, we present to you
the Accountability Report 2011 and before
proceeding further about its content, we
would like to start by mentioning that all the
accomplishments that we see today in Abu
Dhabi, wouldn’t have been possible without the
clear vision of His Highness Sheikh Khalifa bin
Zayed Al Nahyan, President of the UAE and Ruler
of Abu Dhabi and the direction of His Highness
General Sheikh Mohamed bin Zayed Al Nahyan,
Crown Prince of Abu Dhabi, Deputy Supreme
Commander of the UAE Armed Forces and
Chairman of the Abu Dhabi Executive Council.
This report features 2010 highlights and
accomplishments, proving our dedication to
achieving our mission and a testament of our
commitment towards the vision that we share in
Abu Dhabi and that is beyond the boundaries of
ADAA.
The publication of this report, is a reminder at
Abu Dhabi Accountability Authority (ADAA) that
once again lies ahead another year of challenges
to face and overcome, opportunities that bring
us closer to realizing our mandate, more chances
to develop and more room for success.
You will notice the changes we’ve done to
the design and content of our report to better
represent our output groups and you will catch
a glimpse of the path we sketched for the year
ahead revealing our unvarying enthusiasm
towards progression.
We would like to share with you some of 2010
highlights, intriguing you to read further our full
Report:
213 reports across all of its output groups.
Hosted the International Forum for
Independent Audit Regulators (IFIAR)
meeting in Abu Dhabi, marking the UAE as
the first Arab country to host this event.
Established the Abu Dhabi Technical Forum
(ADTF) unifying accounting interpretations
between ADAA, audit firms and accounting
and auditing professionals in the UAE.
Launched the e-maarifa portal, creating a
knowledge platform across the Government
and Subject Entities.
We do not recognize our accomplishments and
highlights that we worked over the past year to
attain as an end; on the contrary we recognize
them as a beginning for setting ADAA standards
and foundations and a step forward to becoming
an authority that is recognized internationally as
one of the top five accountability authorities in
the world.
We have tried since the establishment of ADAA
in 2008 to research and follow international best
practices and to benchmark with top authorities
with one objective in mind, and that is how to
adopt these practices effectively while sustaining
their level of excellence? And having defined
our services based on best practices has made
improvements to such services a great challenge,
and nevertheless it will not daunt our will to
innovate.
Finally, we remain indebted with gratitude to
our leadership for their vision and guidance,
to our Subject Entities for their cooperation
and assistance, to the public for their trust and
confidence and to our people for their passion
and commitment.
We thank you all and promise that we will always
try to exceed your expectations.
Riyad Al Mubarak
Chairman
FOREWORD 09

PART ONE
OVERVIEW
Accountability Report 2011

OVERVIEW 11
1.1 Mandate and Strategic Pillars
1.2 Subject Entities and Functions
1.3 Organization Structure
1.4 Prioritizing Work
1.5 Outcomes
1.6 Accountability and Governance
1.7 People

OVERVIEW 12
OVERVIEW
Our Vision
Our Mission
Our Values
Accountability Report 2011
INTEGRITY AND RESPECT
PROFESSIONALISM
ACCOUNTABILITY AND TRANSPARENCY
"To help improve performance and promote accountability and
transparency across Abu Dhabi Government and Public Entities by
providing independent and objective assurance and advisory services"
"To be one of the top 5 accountability authorities in the world"
The Abu Dhabi Accountability Authority “ADAA” was established on 18th December 2008 as an
independent body reporting to the Abu Dhabi Crown Prince, Chairman of the Executive Council,
ADAA’s primary objectives are to:
Ensure that Public Entities’ resources and funds are managed, collected and expended efficiently,
effectively, economically and ethically.
Ensure accuracy of the financial reports and compliance of the Public Entities with relevant laws,
rules and regulations and governance guidelines.
Promote accountability and transparency across all Public Entities.
1.1 MANDATE AND STRATEGIC PILLARS
Lead by
example
Treating others
with respect
Listening to other points
of view
Being independent, objective and
neutral
Collaborative and effective teamwork
Earning the trust of people we interact with
Being passionate about the work we do
Innovating and going beyond the current standards

OVERVIEW 13
Strategic Goals The strategic goals of ADAA are summarized as follows:
Promote
Governance,
Accountability
and Transparency
Enhance
Performance
Maintain
and Promote
Leading Practices
Develop
Human Capital
Promote high standards of governance, accountability and transparency
to ensure that funds dispensed by public entities, achieve desired goals
efficiently, effectively, economically, and ethically.
Support public entities in enhancing their performance and improve
the quality of data used by decision makers.
Maintain and promote leading practices through continuous research
and development and sharing of knowledge.
Train and develop UAE National graduates. Retain high caliber and
experienced individuals.
Overall Strategy
To assist Subject Entities enhance performance and to promote accountability and transparency by:
Becoming a trusted and welcomed advisor to the Government and Subject Entities.
Leading by example and supporting adoption of better practices.
Enhancing communication and collaboration between Subject Entities and support sharing of
knowledge.

OVERVIEW 14
Accountability Report 2011
Western Region
Development
Council
AD Police AD Education
Council
Environment
Authority - AD
Department
of Economic
Development
ADSIC Department of
Finance
AD Tawteen
Council
Critical National
Infrastructure
Authority
AD Sports
Council
AD Tourism
Authority
Department
of Municipal
Affairs
AD Economic
Development
Council
Urban Planning
Council
Water &
Electricity
Bureau
AD Authority
for Culture &
Heritage
Department of
Transport
Musanada AD Media
Authority
AD Center
for Vocational
Education
AD Food
Control
Authority
Health Authority
- AD
1.2 SUBJECT ENTITIES AND FUNCTIONS
ADAA Subject Entities comprise local departments, councils, authorities and similar entities and
institutions, companies and projects in which the Abu Dhabi Government’s interest is equal to or
greater than 50% inclusive of their subsidiaries, companies and projects.
ADAA may exercise its functions and duties on other entities subject to the criteria set in its mandate.
Public Entities Classification
ADAA has categorized all Public Entities into three classifications illustrating its Subject Entities:
Courts
(Diwans)
Central
Government
Executive
Council
State Owned
Enterprises (SOE)
SOEs
Subsidiaries
(Approx. 150 )
21 SOE
Holdings
Ruler Court Crown Prince
Court
Ruler
Representatives
Courts
Department
of Judiciary
Abu Dhabi
Accountability
Authority
National
Consultative
Council
1 2 3
1. ADNOC
2. AD Fund
3. ADIA
4. IPIC
5. ADWEA
6. ADX
7. Mubadala
8. Etihad
9. GHC
10. TDIC
11. ADSSC
12. ADNEC
13. ADAC
14. ADPC
15. ADIC
16. SEHA
17. ADMC
18. EPC
19. ENEC
20. Daman
21. Union Railway
Executive
Affairs
Government
Entities
General
Secretariat Committees
Other Government Entities (36)

OVERVIEW 15
1. Paris-Sorbonne University–Abu Dhabi
2. Abu Dhabi Vocational Education and Training Institute
3. Institute of Applied Technology
4. Emirates College for Educational Development
5. Khalifa University for Science, Technology and Researches
6. Al Ain Vocational Education and Training Institute
7. Western Region Vocational Education and Training Institute
8. Khalifa Fund for Projects Development
9. Statistics Center - Abu Dhabi
10. Abu Dhabi Quality and Conformity Council
11. Zones Corporation
12. International Fund for Habara Conservation
13. The Center of Waste Management
14. Zoo and Water Life Establishment in Al Ain
15. Abu Dhabi Farmers Services Center
16. Organic Agriculture Center
17. Mohamed bin Zayed Species Conservation Fund
18. Zayed Higher Organization
19. Humanitarian Care & Minors Affairs Authority
20. Family Development Foundation
21. The National Rehabilitation Center
22. Private Housing Loans Authority
23. Abu Dhabi Farmer Financial Support Fund
24. Abu Dhabi Retirement Pensions & Benefits Fund
25. Dar Zayed for Islamic Culture
26. The Emirates Heritage Club
27. Zayed bin Sultan Al Nahayan Charitable & Humanitarian Foundation
28. Khalifa Bin Zayed Al Nahayan Charity Foundation
29. Emirates Foundation
30. Abu Dhabi Municipality
31. Al Ain Municipality
32. Western Region Municipality
33. The Center for Regulation of Transport by Hire Cars (Trans Ad)
34. Compensations Fund for Owners of Taxi Licenses
35. Presidential Flight
36. Office of the Brand Abu Dhabi
EDUCATION
ENVIRONMENT
& AGRICULTURE

ECONOMIC
INFRA–
STRUCTURE
SUPPORT

SOCIAL & CULTURE
Other Government Entities

OVERVIEW 16
Accountability Report 2011
Chairman
Deputy Chairman
Internal Audit
HR &
Communication Legal Affairs &
Investigations
Support
Services
Performance & Risk
Assurance
Financial Audit &
Professional Regulation
Research &
Knowledge
Functions
Law number 14 for 2008 defines ADAA’s responsibilities as follows:
Audit the Government consolidated financial statements and Subject Entities’ financial statements.
Review performance and risk. To fulfill this responsibility, ADAA may from time to time:
Examine the efficiency, effectiveness and economy of the financial and operational activities of
Subject Entities.
Ensure compliance of Subject Entities with Laws, Regulations, and Rules and governance
guidelines.
Examine violations, which are investigated by Subject Entities.
Provide advice and recommendations and perform other procedures and services to Subject
Entities.
Train and qualify UAE National university graduates and establish training centers accordingly.
Conduct investigations into complaints referred to ADAA along with any other violations that
come to its attention.
1.3 ORGANIZATION STRUCTURE
ADAA is structured based on an operating model that is most suited to fulfilling strategic goals while
maintaining clear responsibilities within different departments as shown in the figure below:

OVERVIEW 17
1.4 PRIORITIZING WORK
Identifying and selecting high priority Subject Entities is based on the following criteria:
Concerns raised by the Subject Entities’ stakeholders.
The criticality of the Subject Entities’ role in achieving the Abu Dhabi policy and vision.
The impact of the Subject Entities’ performance on the social, environmental or economical
expectations of the community or general public due to its mandate to service them in various
sectors.
The materiality and relative importance of an amount, transaction, investment, project or public
funds or resources allocated to or disbursed by the Government or a public entity.
The complexity of the Subject Entities’ operations whereby it becomes vulnerable and is prone to
a higher degree of risk in different areas, requiring more effort from ADAA to ensure effective risk
management and corporate governance procedures and processes are in place.
Any emerging trends or factors that may improve government service delivery, including but
not limited to implementation of key policy initiatives in the government and environment and
initiatives enhancing transparency of the regulatory framework.
The severity of performance challenges facing Subject Entities that may hinder the achievement of
their strategies and objectives.
The ownership structure of Subject Entities whereby government departments and agencies
are given top priority, followed by commercially oriented entities owned by the Government
depending on the percentage of ownership and their significance to Abu Dhabi.
ADAA Work
Prioritization
Criteria
Impact of performance challenges
on the social, environmental or
economical expectations of the
community or general public
Complexity of operations
Materiality
Concerns raised by stakeholders
Performance challenges facing
government or its entities
Ownership structure
Emerging trends or factors
which may improve
government service
delivery
Importance to Abu Dhabi
Policy Agenda

OVERVIEW 18
Accountability Report 2011
1.5 OUTCOMES
ADAA’s priorities are derived from its strategic goals and contribute towards achieving the desired
outcomes:
GOALS
OUTPUTS
OUTCOMES
PRIORITIES
GOAL 1
Promote
Governance,
Accountability and
Transparency
GOAL 2
Enhance
Performance
GOAL 3
Maintain
and Promote
Leading Practices
GOAL 4
Develop Human
Capital
1. Provide timely and
high quality financial
assurance services.
2. Assist public entities
to build effective
governance processes
and environments.
3. Enhance reporting and
stimulate significant
improvement in the
provision and usage of
information.
4. ADAA’s stakeholders
understand and accept
the role of ADAA and
recognize the value
of ADAA’s people and
services in contributing to
improving performance.
5. Provide high quality
performance & risk
assurance services and
tailored advisory services
to public entities.
6. Share knowledge
and best practices
across public entities
and support effective
communication.
7. Support the establishment
and development of an
effective internal audit
function in all public
entities.
8. Adopt and maintain
risk based assurance
and audit methodologies.
9. Identify and promote
leading practices in public
entities.
10. Participate effectively
in the regulation and
supervision of the audit
profession.
11. Attract and retain
highly qualified
personnel within a
working environment
that is recognized as a
workplace of choice.
12. Establish ADAA
Training Center to
develop UAE Nationals.
Enhanced accountability and transparency in the public sector.
The public and the world are better informed about accountability in Abu Dhabi Government.
Efficient and effective public sector.
Improved governance and risk management practices in all public entities.
Increased number of qualified UAE nationals in the fields of accountability and audit.
Improved transparency and reliability of financial reporting.
Enhanced compliance with laws, rules and regulations.
Financial Audit and Examination, Performance and Risk Assurance, Supporting Accountability, Special Examination
and ADAA Training Center

OVERVIEW 19
1.6 ACCOUNTABILITY AND GOVERNANCE
In order to enhance, protect and maintain ‘stakeholders’ values, ADAA continuously seeks and
implements the highest standards of governance, corporate transparency, accountability and
performance.
ADAA develops new policies and procedures where appropriate and reviews existing ones governing
its practices and activities and its performance measures and corporate governance to ensure its
independence and accountability.
ADAA’s Accountability and Governance Framework comprises the following aspects:
Strategic Planning Framework
Performance Measures
Audit
Ethical Standards
Employee Retention and Remuneration
Communication
1.6.1 Strategic Planning Framework
ADAA developed its Strategic Planning Framework based on its’ strategic priorities. This framework
is constantly reviewed to ensure its validity and relevance to the current needs of Abu Dhabi and is
considered a guideline for ADAA’s actions and the provision of its services.
STRATEGIC
GOALS AND
OVERALL
STRATEGY
ADAA
MANDATE
PRIORITIES
OUTCOMES
OUTPUTS
Vision
Mission
Values

OVERVIEW 20
Accountability Report 2011
1.6.2 Performance Measures
ADAA’s performance is measured based on a set of internationally recognized performance metrics to
ensure the objectivity of these measurements. ADAA has three types of performance measures:
1. Outcome Performance Indicators: to measure the impact of ADAA’s work on the state
or condition of the society, the economy, or the environment and any change in that state or
condition.
2. Output Performance Indicators: to measure the cost, quantity, quality and timeliness of ADAA
services (outputs).
3. Internal Performance Indicators: to measure the performance of ADAA internal departments
and units.
Internal
Performance
Indicators
Output
Performance
Indicators
Outcome
Performance
Indicators
Subject Entities Feedback
ADAA seeks feedback from its Subject Entities on the review process executed after the issuance
of each of its reports. The feedback received constitutes an important guide to the effectiveness of
existing practices and further developments that may be required.
1.6.3 Audit
ADAA’s financial statements are audited each year by an external auditor. For the year 2010, Ernst and
Young was reappointed as auditor in accordance with the Statutory Auditor Appointment Rules issued
by ADAA for a fee of AED 83,000.
In addition, ADAA reviews its internal controls, including financial, operational and compliance controls
to ensure that its processes are in line with best practice, laws, rules and regulations.

OVERVIEW 21
1.6.4 Ethical Standards
ADAA implements a rigorous Code of Conduct concerning business and professional ethics and to
ensure that all ADAA employees apply strong ethical standards. ADAA’s Compliance officer ensures
adherence to the code of conduct.
All ADAA employees take an oath before the ADAA Chairman upon joining the Authority as per Article
(9) of Law (14) on the establishment of ADAA. The oath is as follows: “I swear by almighty God to be
loyal to the Ruler of the Country, to honor the constitution and law, to work to safeguard public funds,
to perform my duties honestly and sincerely and to maintain the confidentiality of all business”.
1.6.5 Employee Retention and Remuneration
ADAA implements a remuneration policy and procedure for all employees as well as a performance
management system to ensure fair evaluations of employee performance and identifies clear career
paths and progression plans.
ADAA utilizes employees training programs and workshops to enhance employees’ capabilities, skills,
knowledge and competence to grow within their careers.
1.6.6 Communication
ADAA considers communication a crucial and indispensable approach to achieve transparency with its
stakeholders; be it Subject Entities, the general public or ADAA employees.
In early 2009, ADAA launched its new identity and by mid 2009 the official ADAA website was
launched on www.adaa.abudhabi.ae along with other communication initiatives such as the monthly
e-newsletter “ADAA Digest”, networking seminars and workshops in different areas to highlight and
explain ADAA’s role.
In 2010, ADAA expanded external communication and launched new government- wide initiatives
opening further networking opportunities and sharing knowledge and best practices with its Subject
Entities and key stakeholders such as the e-maarifa portal, the Abu Dhabi Audit Management portal in
addition to workshops and panel discussions on new services and policies.
1.7 PEOPLE
ADAA views its people as its primary assets. All are top-tier professionals from multi-cultural
backgrounds, and are unified by ADAA’s values, vision and mission.
ADAA is committed to develop and attract Emiratis to the Accounting and Audit profession. The
Authority has defined career paths and growth plans for all employees and promotes the success of
ADAA as one team.

PART TWO
OUTPUT GROUPS
Accountability Report 2011

OUTPUT GROUPS 23
2.1 Financial Audit and Examination
2.2 Performance and Risk Assurance
2.3 Supporting Accountability
2.4 Special Examination
2.5 ADAA Training Center

OUTPUT GROUPS 24
Accountability Report 2011
OUTPUT GROUPS
2.1 FINANCIAL AUDIT AND EXAMINATION
ADAA’s statutory responsibility underlies in granting stakeholders reassurance that the Government’s
consolidated financial statements and the financial reports issued by Subject Entities are free from
material misstatements through the audit conducted by ADAA. This process also includes an audit on
the role of the relative management in establishing robust processes and controls to ensure reasonable
accuracy of these statements.
ADAA provides 3 types of outputs under Financial Audit and Examination, as mentioned below:
Financial Audits
Financial Examinations
Financial Management Assessments
2.1.1 Financial Audits
ADAA established its financial audit procedures based on the International Standards on Auditing
(ISA) issued by the International Federation of Accountants (IFAC). ADAA carries out the audits of the
consolidated financial statements of the Government and expresses an opinion on those statements, it
also reviews the financial statements of Government Departments.
In addition, ADAA conducts special purpose audit services on specific components of Subject Entities’
financial statements.
2.1.2 Financial Examinations
Where the establishment law of a Subject Entity requires that their financial statements be audited
by a statutory auditor, ADAA fulfills its responsibility to provide assurance on the accuracy of the
financial statements of the Subject Entity by the implementation of the Statutory Auditor Appointment
Rules (SAAR) and an examination of the Subject Entity’s financial statements and of the audit work
undertaken by the statutory auditor.
Statutory Auditor Appointment Rules (SAAR)
The Chairman of ADAA issued Resolution no (1) for 2010 pertaining to Statutory Auditor Appointment
Rules (SAAR). All Subject Entities must comply with SAAR when they appoint their statutory auditor.
The objective of SAAR is to strengthen the governance process of the appointment of the statutory
auditor.

OUTPUT GROUPS 25
Financial Examination Methodology
ADAA developed a comprehensive Financial Examination Methodology to ensure the quality of audit
work undertaken by statutory auditors in providing their audit opinions on the financial statements
of Subject Entities. Accordingly, it enhances users’ confidence in the accuracy and transparency of
financial statements and financial reporting.
The Methodology requires examination of the documents, records and working papers of the
statutory auditor and any other information, data and reports, as ADAA considers necessary.
The Financial Examination Methodology conforms with the pronouncements and methodologies of
the International Federation of Accountants (IFAC).
Receive financial
statements and
perform
financial
analysis
1
Meet with SA
to discuss list of
queries
6
Prepare draft
letter of
comments and
incorporate SA
responses
7
Prepare list of
queries
5
Issue
Engagement
Letter
2
Review working
papers of SA
4
Plan the
assignment
3
E
X
E
C
U
T
I
O
N
R
EPO
R
T
I
N
G
Issue final letter of
comments to SA
8
Issue ADAA Financial
Examination Report to
the Chairman of the
Subject Entity
9
*SA (Statutory Auditor)
P
L
A
N
N
I
N
G

OUTPUT GROUPS 26
Accountability Report 2011
2.1.3 Financial Management Assessments
ADAA introduced the Financial Management Assessment (FMA) process which provides an independent
review and comprehensive understanding of the financial management capabilities within Subject
Entities.
The FMA aims to strengthen the finance functions of Subject Entities and assist them to elevate the level
of service they provide to internationally acknowledged best practices. ADAA utilizes a standard model
designed as a resource for assessment of the Subject Entities’ financial management Function.
As shown below, the model used is developed from good practice statements put by the Chartered
Institute of Public Finance and Accountancy (CIPFA), a well known leading professional institute for
accountants working in the public services in the United Kingdom and (CIPFA) is also a member of the
International Federation of Accountants.
Activities
Steps Project Initiation Execution Reporting
Timeline 2 - 4 weeks
Meet with financial
management.
Review of
supporting
documentation.
Identify people to
interview.
Conduct interviews.
Complete the
checklist.
Compare to best
practices.
Develop
recommendations
to capitalize on
the opportunities
identified.
Discuss and
obtain informal
comments
on identified
improvement
recomendations.
Prepare and issue
the report.

OUTPUT GROUPS 27
2.2 PERFORMANCE AND RISK ASSURANCE
ADAA provides assurance that Subject Entities’ activities and resources are managed and utilized
efficiently, effectively, economically and ethically as well as in compliance with the relevant laws, rules,
regulations and governance guidelines.
ADAA Performance and Risk Assurance also assists in sharing knowledge and best practices across
functions and entities, assessing their risk profile, assisting in building effective Internal Audit and
Governance processes and implementing an effective Anti-Fraud Program.
ADAA provides 3 types of outputs under Performance and Risk Assurance as mentioned below:
Performance and Compliance Review
Internal Audit Assessment
Anti-Fraud Program
2.2.1 Performance and Compliance Review
Performance and Compliance Reviews are designed to provide objective evaluations of entities or
programs on the development, implementation and adherence to laws, regulations or accepted leading
practices required to produce their mandated output in a controlled and sustainable environment.
Based on auditing industry best practices, Performance and Compliance Reviews diagnose issues
employing methodologies developed internally. Each review has four discrete steps as described below:
ADAA currently conducts 3 forms of Compliance and Performance Reviews:
Program Reviews provide a substantive review of high profile initiatives and projects involving one
or more Abu Dhabi Government Entities. The focus of the Review is on evaluating if a program or
initiative has access to capabilities needed to deliver the stated program objectives in an effective,
efficient, economical and ethical manner.
Business Regulation Reviews evaluates whether the production of specific government goods or
services complies with published regulations. The focus is on reviewing the appropriateness of the
regulations compared to leading practices in the field; monitoring the effectiveness of operations in
implementing the regulations, and evaluating the quality and effectiveness of the output.
Procurement Reviews look at the procurement functions of a Government Entity or project. The
Review evaluates the procurement activities against criteria extracted from both relevant procurement
laws and regulations, and internationally accepted government practices.
Set review
criteria Conduct
fieldwork Derive key
conclusions
Develop
recommend-
ations
Issue
report

OUTPUT GROUPS 28
Accountability Report 2011
2.2.2 Internal Audit Assessment
Internal
Audit
Assessment
Methodology
Organization
Operation
Audit Committee
Technology
Value
Discuss Results
with Head of
Internal Audit
Perform
Assessment
Contact Head of
Internal Audit
Identify Subject
Entity Issue Report Present Results
to the Audit
Committee
ADAA conducts independent reviews of the Internal Audit role within Subject Entities to help them
strengthen this vital aspect of governance, and to obtain a comprehensive understanding of available
capabilities based on which ADAA can establish or not reliance on those Functions. The Internal Audit
Assessment conducted by ADAA aims at providing reasonable assurance that Internal Audit operations
within Subject Entities assessed are performed in accordance with approved charters and leading
practices.
The Internal Audit Assessment uses a detailed framework developed internally, which follows
“The Institute of Internal Auditors” (IIA) best practices for assessing Internal Audit Functions. The
methodology follows the steps below:
The Assessment
conducted is based on
measuring the Internal
Audit function on a series
of 6 elements: Audit
Committee, Organization,
Methodology, Operation,
Technology and Value.

OUTPUT GROUPS 29
2.2.3 Anti-Fraud Program
ADAA assesses a Subject Entity’s vulnerability to fraud, corruption and misconduct (‘fraud’) and
their ability to mitigate fraud risks across different organizational elements and to follow a proactive
approach when addressing these vulnerabilities. ADAA conducts fraud risk assessments, independent
reviews and provides detailed analysis together with recommendations to improve fraud risk
management within Subject Entities.
ADAA established the Anti-Fraud Program to assist the Government in creating a protective shield
against fraud whereby this program covers different aspects within any Subject Entity as illustrated
below:
ADAA supports Subject Entities in the following:
Develop a fraud control policy for each entity.
Conduct Fraud Scenario Assessments to assess and address potential fraud risk exposures.
Train employees on the fraud control policy and code of conduct.
Assist in the development and implementation of the confidential disclosure systems.
2.3 SUPPORTING ACCOUNTABILITY
ADAA, as mandated in its Law of establishment, has a primary objective to promote accountability
and transparency and hence has established this output group to develop and oversee various support
mechanisms and services achieving this objective.
The Chairman of ADAA reports periodically to HH the Crown Prince of Abu Dhabi and carries out other
functions, duties and responsibilities allotted by HH the Crown Prince to ADAA as well as providing
advisory and assistance to Executive Council members and other key executives in the Government to
hold Subject Entities on their requirements and related accountability systems.
Internal
& External
Awareness
Integrated
Policy
Internal &
External
Reporting
Fraud
Scenario
Assessment
Investigations

OUTPUT GROUPS 30
Accountability Report 2011
Advisory and Assistance
ADAA provides advice and assistance to Subject Entities to assist them on subjects that complement
ADAA’s primary role and fall within its area of expertise. ADAA provides Advisory and Assistance based
on the receipt of an official request from the Subject Entity and upon approval of ADAA Chairman.
ADAA advice and assistance is provided in many areas and functions such as: assisting audit
committees and internal audit at Subject Entities in establishing their internal audit functions,
secondments of ADAA employees to Subject Entities and providing technical advice.
National and International Representation
ADAA actively participates in the regulation and supervision
of the accounting and audit profession through participating
in the membership of various national and international
organizations that promote and support accountability and
transparency and contributes to the enhancement of laws, rules
and regulations in this area. ADAA regularly attends related
business conferences, workshops, and meetings and prepares
research papers and participates in the exchange of information
and training.
ADAA also contributes to the development of other
accountability and audit organizations by hosting national and
international delegations throughout the year.
2.4 SPECIAL EXAMINATIONS
ADAA examines complaints referred to it and will investigate alledged violations at Subject Entities
and tracks fraud, corruption and misconduct (collectively “fraud”) to ensure that public money is safe
guarded and that stringent regulations are enforced in operational, financial and managerial processes.
Special Examinations are conducted in accordance with ADAA approved regulations and may involve
liaisons with external consultants, legal counsel and law enforcement agencies.
Through its investigation, ADAA identifies fraud prevention issues and maintains strategic alliances to
optimize investigative and preventive outcomes.
ADAA conducts Special Examinations relating to:
Violations of the financial rules and provisions of laws, regulations and other legislations.
Violations in the provisions of the general budget of the Emirate, and the budgets of Subject
Entities.
Violations of the provisions regulating purchases, bids, tenders, auctions and stores and/or any
other rules, provisions, regulations and financial and accounting circulars that are applied at
Subject Entities.
ADAA was the 1st
organization in
the Middle East to
become a member
of IFIAR

OUTPUT GROUPS 31
Any negligence or failure, which results in a direct financial loss to the Emirate or other public
entities or Subject Entities, or which results in, or may lead to, compromising any of its financial
interests.
ADAA has established an internal process to receive complaints and developed a Special Examination
methodology as shown in the following figure:
Violations are dealt with as follow:
1. Filing the matter due to inaccuracy or the absence
of a violation or its insignificance.
2. Applying disciplinary action.
3. Refering the case to relevant public prosecutor
office if a punitive crime is suspected.
Complaint/
Violation Received
& Registered
Present to ADAA
Chairman
ADAA
Department
Open
Investigation
Collect Evidence &
Investigate
Prepare
Report
Present to ADAA
Chairman
Issue
Report
Disciplinary Action
Against Violators Refer to Public
Prosecutor
Open
Examination
Inquire & Collect
Data
Conclude
Result
Present to ADAA
Chairman
Need more
Information
Issue
Report
File &
Close
File for
investigation
Subject Entity Public
Law
Enforcement
Suspected
crime
No
Yes

OUTPUT GROUPS 32
Accountability Report 2011
2.5 ADAA TRAINING CENTER
ADAA Training Center aims at becoming a recognized center of excellence that provides training
and development to help qualify UAE National Graduates. It also provides in-depth knowledge and
awareness of leading practices within the government and internationally whether it is industry-specific
or by departmental functions.
Under this output group, ADAA has designed 3 outputs:
Qualifying Emirati Auditors
Research and Knowledge Sharing
Workshops and Seminars
2.5.1 Qualifying Emirati Auditors
ADAA is determine to increase the number of qualified Emirati Auditors and has designed training
programs that will help them acquire the necessary skills and knowledge to advance and excel in their
careers and presume leadership roles and become key components in the growth and success of the
Emirate of Abu Dhabi.
ADAA Training Center offers professional certifications training in the Accounting and Audit profession
such as the Certified Public Accountant (CPA) examination preparation course and the Certified Internal
Auditor (CIA) examination preparation course to UAE Nationals.
2.5.2 Research and Knowledge Sharing
In line with the Abu Dhabi Policy Agenda of developing a sustainable knowledge based economy,
ADAA has set-up its in-house Research and Knowledge Management (RKM) function in 2009.
The objective of RKM is to develop, codify and disseminate knowledge more effectively across all areas
of ADAA’s operations as well as contributing towards supporting the research and knowledge needs
and capabilities of Subject Entities.
ADAA’s research and knowledge sharing initiatives include:
E-maarifa: In 2010, e-maarifa portal was launched with the objective of creating a knowledge
platform across the Government and Subject Entities that enables participants to share experience
and transmit knowledge more effectively across common operational functions.
ADAA Digest: ADAA issues a monthly e-newsletter titled “ADAA Digest” whereby its primary
focus is on accounting issues that are relevant to the financial reporting of the Subject Entities. The
aim of the digest is to eliminate inconsistencies in accounting by highlighting both changes in new
standards and inconsistencies in the application of current standards.

OUTPUT GROUPS 33
Global Accountability & Transparency:
ADAA issues a monthly newsletter
under the title “Global Accountability &
Transparency” whereby various topics
and research papers are covered and
discussed.
Practice Guides: In seeking to improve
public administration, ADAA identifies
best practices that are internationally
recognized and implemented and issues
practice guides for use throughout the
public sector.
2.5.3 Workshops and
Seminars
ADAA provides workshops and seminars to Subject Entities on matters that complement its primary
role and fall within its area of expertise.
Abu Dhabi Technical Forum (ADTF): This Forum brings together the UAE based audit
professionals of the international accounting firms. Discussions focus on current and expected
problematic accounting treatments. The aim of the forum is to eliminate the local inconsistency
in application of accounting standards by building consensus on the interpretation of accounting
standards and the acceptability (or not) of accounting treatments, thereby improving the
comparability and quality of financial reporting in Abu Dhabi.
Internal Audit Seminar: This annual event brings together all the key people in the Internal Audit
function at Subject Entities to discuss process, internal controls, policies, issues and challenges as
well as share knowledge of best practices and developments.
Panel Discussions and Workshops: ADAA conducts regular panel discussions and workshops on
emerging issues.
“ADAA Digest” highlights;
hot topics in the accounting
profession. ADAA also
has a specialist IFRS “Help
Desk” that receives internal
and external requests for
help and advice on the
interpretation of standards
and releases a technical
paper accordingly to the
concerned party.

PART THREE
Accountability Report 2011
2010 REPORT
AND 2011
WORK PLAN

2010 REPORT AND 2011 WORK PLAN 35
3.1 2010 Highlights
3.2 Output Group 1: Financial Audit and Examination
3.3 Output Group 2: Performance and Risk Assurance
3.4 Output Group 3: Supporting Accountability
3.5 Output Group 4: Special Examination
3.6 Output Group 5: ADAA Training Center
3.7 2011 Work Plan

2010 REPORT AND 2011 WORK PLAN 36
Accountability Report 2011
2010 REPORT AND 2011 WORK
3.1 2010 HIGHLIGHTS
Below is a summary of ADAA’s achievements in 2010:
Issued 96 Financial Audit and Examination reports:
9 Financial Audits
82 Financial Examianations
5 Financial Management Assessments
Issued 83 Performance and Risk Assurance reports:
14 Performance and Compliance Reviews
63 Internal Audit Assessments
6 Anti-Fraud Program reports
Issued 19 Supporting Accountability reports.
Issued 15 Special Examination reports:
5 Investigations reports
9 Examinations reports
1 Technical advice report
Hosted the International Forum of Independent Audit Regulators (IFIAR) in Abu Dhabi during
March 2010 making the UAE the first Arab country to host this event.
Issued Statutory Auditor Appointment Rules “SAAR” and published it in the Official Gazette of the
Emirate.
Succeeded in its initiative to bring the USA Certified Public Accountant (CPA) examinations to Abu
Dhabi and the region after long negotiations with the National Association of State Boards of
Accountancy “NASBA”
Launched a new service, the “Financial Management Assessment” to strengthen the role of the
finance function within Subject Entities. The FMA is based on the methodology adopted by the
Chartered Institute of Public Finance and Accountancy of UK – CIPFA and was conducted in 5
Subject Entities.
Launched the e-maarifa portal with the objective of creating a knowledge sharing platform across
the Government and Subject Entities.
Successfully deployed a knowledge sharing platform under e-maarifa for the Internal Audit
community titled “Abu Dhabi Audit Management (ADAM)”, with membership of 300 government
employees across 66 entities.
Established the Abu Dhabi Technical Forum (ADTF) with the objective of unifying the accounting
interpretations between ADAA and the audit firms and accounting and auditing professionals in
the UAE.
Below is a summary of the 2010 achievements, whereby ADAA did the following:

2010 REPORT AND 2011 WORK PLAN 37
Extended ADAA’s role in the Governance Committee by coordinating and aligning various projects
as well as providing technical expertise and research support.
Completed over 120 research assignments, including 2 major baseline surveys, 4 research papers,
several global benchmarking assignments and 10 research primers.
Issued and published an Internal Audit Practice Guide which collates the best internationally
recognized practices in the profession.
Assisted Subject Entities in recruiting their heads of internal audit.
Provided Subject Entities with expertise and professionals through seconding ADAA employees.
Held an internal audit seminar for Subject Entities.
The following table provides a summary of reports issued by ADAA*:
* Certain comparative numbers have been reclassified to conform to current year’s output group presentation.
** The total cost represents ADAA budget (target) and actual as per ADAA audited financial statements and includes the cost
of other ADAA outputs.
Description
2009
Actual
Target
2010
Actual
2010
1 Financial Audit and Examination 78 94 96
2 Performance and Risk Assurance 69 85 83
3 Supporting Accountability 9 13 19
4 Special Examination 11 10 15
5 ADAA Training Center NA NA NA
Total Number of Reports 167 202 213
Total Cost (AED)** 103,073,469 136,237,000 110,287,672

2010 REPORT AND 2011 WORK PLAN 38
Accountability Report 2011
3.2 OUTPUT GROUP 1:
FINANCIAL AUDIT AND EXAMINATION
This output group focused on the financial audit of the government of Abu Dhabi accounts, and
financial reports examinations of Subject Entities based on its own uniquely developed methodology.
During the course of its work, this group advises Subject Entities how to improve the quality of their
financial reporting and specifically relating to their financial statemants basis of preparation. Which
varies according to Subject Entities operations. There has been a notable change in financial statements
basis of preparation since year 2008, with a focus on having all government entities and courts prepare
their financial statements using IPSAS Accrual basis of accounting.
The following charts demonstrate the change in Subject Entities financial statements basis of
preparation as recommended by ADAA:
Government Entities and Courts financial Statements Basis
of Preparation
State Owned Entities Financial Statements Basis of Preparation
30
25
20
15
10
5
0
25 26
20
1
6
14
2
7 7
11
6 6
27
21
19
IFRS – Accrual IPSAS – Accrual basis IPSAS – Cash basis Other basis of
preparation Non-attested
financial statements
2008 2009 2010
17 18
3
19
2
4
20
15
10
5
0
2008 2009 2010
IFRS- Accrual Other basis of preparation

2010 REPORT AND 2011 WORK PLAN 39
The group’s reports and recommendations are the result of one of the following services:
Financial Audit
Financial Examination
Financial Management Assessment
3.2.1 Financial Audit
ADAA completed its audit of the consolidated financial statements of the Abu Dhabi Government
for the year ended 31 December 2009 and issued an unqualified (clean) opinion within the deadline
specified in the Financial Management Law.
The financial statements were prepared on a cash basis in accordance with International Public Sector
Accounting Standards (IPSAS). ADAA conducts its financial statements audits in accordance with
International Standards on Auditing (ISA).
In addition, ADAA performed review engagements of the financial statements of Government
Departments in accordance with the International Standards on Review Engagements (ISREs) issued
by IFAC.
3.2.2 Financial Examination
During 2010, ADAA examined 82 independent audit reports and work of Statutory Auditors,
appointed by Subject Entities. The financial statements and audits covered in 2010 were selected in
accordance with the prioritization criteria developed by ADAA.
ADAA’s Financial Examination Comments Summary
Comments arising from our financial reports examination are communicated to those charged
with governance at Subject Entities and separately to statutory auditors for future improvements,
implementation and follow up. Our examinations continue to highlight a number of areas where
improvements are required. In order of significance; these are as follows:
Significant delays in issuing financial statements. This reduces the usefulness of those statements.
Although there is no deadline for Subject Entities to have the financial statements signed, however,
there is a deadline of 30 June for issuing the Consolidated Financial Statements of Abu Dhabi
Government that are audited by ADAA.
Valuations based on invalid or untested assumptions for impairment reviews and assets.
Deficiencies in the audit procedures performed when auditing accounting estimates.
Weaknesses in the quality of audit evidence statutory auditors rely on.

2010 REPORT AND 2011 WORK PLAN 40
Accountability Report 2011
Management’s reliance on statutory auditors for financial reporting and accounting matters.
Significant inadequacy by the statutory auditors when computing materiality.
Shortcomings in statutory auditors audit procedures over commitments, contingencies, compliance
with laws and regulations, and subsequent events.
Missing necessary disclosures required by the relevant accounting standards (IFRS/IPSAS) to
enhance users understanding of the financial statements.
Poor audit procedures applied for consolidated financial statements and related parties
transactions.
Statutory auditors working paper files not documenting properly the audit procedures performed.
In-adequate audit procedures performed when statutory auditors decide to rely on the work of
experts and service organizations.
All examination comments are set out in detail in our examination reports sent to Subject Entities for
implementation and improvement in the future.
Our reports include the responses and explanations provided by the statutory auditors and our final
conclusions and views on each examination comment.
Analysis of Examination Comments
Our comments are classified into “Significant improvement required”, “Needs improvement” and
“Needs improvement - Specific exceptions noted” based on their nature and significance to the
financial statements of Subject Entities and the Statutory Auditor’s Audit process.
Below is a comparison of the financial examination reports, conducted in 2010 and 2009:
Needs improvement Needs improvement -
Specific exception noted Significant improvement
required
2010
(82 reports) 2009
(76 reports)
142 67
362 497
208
123

2010 REPORT AND 2011 WORK PLAN 41
Our financial examination reports included 712 comments in 2010 classified as follows:
Significant Improvement Required
142 comments in 2010 were classified into this category. These comments require the immediate focus
of the Subject Entities’ management and their statutory auditors since in our judgement they have a
significant effect on the financial statements of Subject Entities.
Needs Improvement
The majority of our 362 comments in this category focus on audit quality resulting from incomplete
documentation of audit procedures performed, such as consideration of fraud risks and calculation of
sample sizes. These comments highlight scope for improvement relating to audit procedures applied by
the statutory auditors. If such procedures were performed, as entailed in the International Standards
on Auditing or other applicable standards, a potential adjustment to the Subject Entities’ financial
statements might have been noted.
Needs Improvement – Specific Exception Noted
208 comments in 2010 were raised highlighting specific exceptions to the financial statements audit
process and/or the management’s financial statements closing process. Had these exceptions been
noted during the audit process, they might have resulted in an adjustment to the audit process and/or
the financial statements of the Subject Entities.
Generally, these comments related to areas including, but not limited to, specific accounting treatments
resulting from wrong application of IFRSs, financial statements presentation and disclosures, and
insufficient audit procedures in areas such as related parties, estimates, and fair values.
Year 2010 Year 2009
Statutory
Auditor
Number
of reports
examined
Significant
improvem-
ent
required
Needs
improvem-
ent
Needs
improvem-
ent –
Specific
exceptions
noted Total
Comments
Number
of reports
examined Total
Comments
Firm 1 47 92 201 130 423 28 265
Firm 2 17 30 84 43 157 25 255
Firm 3 11 15 55 19 89 15 120
Firm 4 7 5 22 16 43 7 38
Firm 5 - - - - - 1 9
Grand Total 82 142 362 208 712 76 687

2010 REPORT AND 2011 WORK PLAN 42
Accountability Report 2011
Implementation of SAAR
During 2010, the Chairman of ADAA issued resolution number (1) of 2010 establishing the Statutory
Auditors Appointment Rules (SAAR) which was published as a special edition in Official Gazette of the
Emirate in January 2010.
According to SAAR, Subject Entities need to go through a rigorous, well documented process when
selecting and appointing their statutory auditors.
3.2.3 Financial Management Assessment
In 2010, ADAA started the implementation of its “Financial Management Assessment (FMA)” in
Subject Entities. FMAs were conducted in 5 Subject Entities reviewing their financial capabilities,
processes and assisting them in enhancing and strengthening their finance functions and financial
management processes.
It is worth mentioning that all Subject Entities and their employees have been of great assistance to
ADAA during the FMA which resulted in relevant yet challenging recommendations to be implemented
in the future.
Upon conducting the 5 FMAs, ADAA found that Financial Management at 2 Subject Entities are at
an “Emerging” stage while 3 Subject Entities were at a “Maturing” stage based on the assessment
methodology created by ADAA.
3.3 OUTPUT GROUP 2:
PERFORMANCE AND RISK ASSURANCE
This output group provides assurance on the efficient, effective, economic and ethical utilization of
resources by Subject Entities and their compliance with the laws, rules, regulations and governance
guidelines.
In 2010, ADAA issued 83 Performance and Risk Assurance reports relating to government-wide issues,
functional areas and subjects of significance for Subject Entities.
ADAA believes in the importance of the establishment of Audit Committees and internal Audit
functions at Subject Entities to enhance their governance structure.

2010 REPORT AND 2011 WORK PLAN 43
The following chart demonstrates the development of Audit Committees and Internal Audit functions
within Subject Entities:
This output group’s reports and recommendations are the result of one of the following services:
Performance and Compliance Reviews
Internal Audit Assessment
Anti-Fraud Program
3.3.1 Performance and Compliance Reviews
The Performance and Compliance Reviews deliverables during 2010 were related to various sectors
and covered different disciplines including operational expenditures, capital expenditures, projects and
business regulation. These reviews assist in highlighting gaps and areas for improvement in compliance
with laws, regulations and rules and ensure the alignment of performance with strategic objectives and
leading practices.
Outputs of Performance and Compliance Reviews are typical to the mandate of ADAA and represent
an aspect of assurance that ADAA undertakes on an annual basis.
50
45
40
35
30
25
20
15
10
5
0
6
17 16
23
35 37
46 46
Prior to Year 2008 Year 2008 Year 2009 Year 2010
Audit Committee Internal Audit Function

2010 REPORT AND 2011 WORK PLAN 44
Accountability Report 2011
Below are summaries of some of the Performance and Compliance Reviews that were conducted in
2010 with a brief description of the scope of the review and recommendations by ADAA:
Social Care and Minors Affairs Foundation (SCMAF)
ADAA carried out a strategic and organizational assessment of SCMAF and assisted the Foundation in
developing a strategic action plan in relation to the following:
Understanding the stakeholders and beneficiaries needs and expectations.
Investment strategy and poor historical investment performance.
Capabilities in asset management and financial planning to support income disbursement decisions.
Social care services and coordination with other governmental social entities.
Setting the vision, mission and strategic direction and the level of employee satisfaction.
Organizational capabilities and structure and cross-functional processes.
Medical Licensing Compliance Review
The scope of this review covered medical licensing activities at the Health Authority – Abu Dhabi
(HAAD) for the period running from January 2008 to May 2010. It only covered the activities of the
departments relating to licensing and inspection in relation to the following:
Developing an accurate picture of medical licensing and inspection processes.
Recommendations
ADAA proposed a detailed 2 year action plan with more than 20 strategic and organizational
initiatives.
ADAA recommendations included:
Outsource asset management and build a lean core investment function.
Transform social care to cater to the needs of minors and establish partnerships with priority
social entities.
Drive to greater beneficiary focus by understanding Minors’ needs, segmenting them and
streamlining administrative functions and moving more staff to beneficiary-facing functions.
Close HR gaps by investing in training, hiring and aligning incentives to attract talent.
Upgrade core processes and tools to enable organizational effectiveness and streamline
execution.
Build the IT backbone and upgrade the databases by defining and implementing IT
requirements.

2010 REPORT AND 2011 WORK PLAN 45
Recommendations
ADAA recommendations included:
Perform a strategic review of the licensing regime and consider the establishment of another
body to act as the medical examination board.
Centralize the issuance of health licensing guidelines and regulations to one specific
committee.
Implement a regulation for medical revalidation to provide a focus for doctors’ efforts to
maintain and improve their practice to enhance their capabilities and qualifications.
Review the current sanctions scheme and consider imposing escalating fines up to reaching
facility suspension.
Tourism Licensing Compliance Review
The scope of this review involved the following steps for the period running from February 2005 to
March 2010 in relation to the following:
Developing an accurate picture of ADTA’s Licensing process.
Evaluating whether ADTA’s Licensing Section complies with the applicable laws and regulations
and resolutions issued by the Chairman of ADTA.
Assessing whether the licensing procedures and approaches comply with leading licensing
practices.
Recommendations
ADAA recommendations included:
Establish the Review Committee and activate its mandate to support the activity for which it
was initially conceived.
Develop classification manual for restaurants, resorts and rest houses to ensure their proper
classification.
Increase the frequency of spot inspections to monitor the performance of tourism
establishments.
Restrict tour guides licenses to persons authorized to work in the UAE and create an updated
directory of all tour guides operating in Abu Dhabi along with their licensing status (active and
inactive), the language(s) they speak and the guiding category (general, site or provisional).
Evaluating whether HAAD’s licensing and inspection departments comply with the applicable laws
and regulations and resolutions issued by the Chairman of HAAD.
Assessing whether the licensing procedures and approach comply with leading licensing practices.

2010 REPORT AND 2011 WORK PLAN 46
Accountability Report 2011
Agricultural Subsidies Compliance Review
The scope of this review involved the activity in 2009 relating to the development of an accurate
picture of Abu Dhabi Food Control Authority’s (ADFCA) agricultural subsidies process including the
promotion of agricultural products, the subsidization of produce, provision of assistance to farmers,
and the import of feed.
Capital and Operating Expenditures Procurement Compliance Reviews
During 2010, ADAA conducted 6 capital expenditures procurement compliance reviews and 3
operational expenditures procurement compliance reviews
The scope of the reviews was:
Determining the degree of consistency in applying laws and regulations by Subject Entities.
Evaluating instances of non-compliance to take the appropriate action.
Assessing the incorporation of leading international practices in procurement management, then
developing a position on the current state of such management, and identifying relevant gaps to
propose recommendations for necessary improvements.
Some of these compliance reviews led to the discovery of violations that were further investigated and
resulted in disciplinary action against certain individuals.
3.3.2 Internal Audit Assessment
During 2010, ADAA issued 63 Internal Audit Assessment reports. This came as a continuum to the
initial wave of assessments conducted during 2009. The purpose was to identify gaps in performance
and areas for improvement to bring the internal audit department up to benchmarked practices.
Recommendations
ADAA recommendations included:
Expedite the process of integrating the legacy of the former Department of Agricultural
Affairs to enhance the ability of ADFCA to manage the Sector.
Establish protocols to ensure that agricultural plans are approved in due course and in a timely
manner.
Coordinate with the Food Security Committee to ensure that operations taken at the tactical
level are aligned with the agreed strategy.
Develop awareness campaigns for farmers on the proper use of pesticide, water resources,
crop management, etc.
Update all the information pertaining to farmers, lands, and vendors and maintain a useable
database to facilitate and support decision making on a prompt basis.

2010 REPORT AND 2011 WORK PLAN 47
However, another key objective was to obtain assurance with regard to the Internal Audit role in terms
of highlighting areas of risk exposure. Where such assurance was not obtained, the entity was selected
for review and was included in ADAA’s plan.
Internal Audit functions were assessed on a series of 6 elements: Audit Committee, Methodology,
Organization, Operation, Technology and Value.
Internal Audit Assessment Reports Summary
ADAA issued 1,304 recommendations to provide Subject Entities with insight on their control
environments and for the enhancement of their governance structures. In line with ADAA
methodology, the final results of the assessment of internal audit functions at Subject Entities are
presented by element along with the final score and key observations noted during the assessment.
The graph below recaps the distribution of recommendations by each of the elements:
Out of 63 Subject Entities, 32 met pass requirements based on the criteria established by ADAA, while
31 did not. The following figure shows the result of the internal audit assessment conducted in 2010
compared to 2009.
153
380
116
285
273
97
Value
Technology
Operation
Methodology
Audit Committee
Organization
0 100 200 300 400
31 19 15 32
No Pass
Pass
2010
(63 assessments) 2009
(34 assessments)

2010 REPORT AND 2011 WORK PLAN 48
Accountability Report 2011
3.3.3 Anti-Fraud Program
ADAA established the Anti-Fraud Program to assist its Subject Entities in creating a proactive response
to any potential vulnerability to fraud, corruption and misconduct “fraud”. This Program is intended
to support Subject Entities in many areas such as the development of their own fraud control policy,
conducting Fraud Scenario Assessments, training employees on the code of conduct and the fraud
control policy and the development and implementation of confidential disclosure systems.
Fraud Scenario Assessments
ADAA developed a methodology on “Fraud Scenario Assessment (FSA)” that will be used by ADAA
and its Subject Entities when planning for, or conducting a Fraud Scenario Assessment as part of their
overall Fraud Risk management and helps the entities identify existing weaknesses in controls, identify
gaps and setting priorities of controls to manage risks.
During 2010, ADAA conducted 6 Fraud Scenario Assessments and independent reviews and provided
detailed analysis together with recommendations necessary to identify the entity’s vulnerabilities to
fraud and the potential impact in order to improve systems policies, procedures and processes for the
Subject Entities. Some ADAA key recommendations are:
1. Develop an anti-fraud policy and an employee code of conduct that is required to be read and
acknowledged by all new and existing employees on an annual basis.
2. Establish a code of conduct for suppliers and vendors for contracts over a certain threshold value.
3. Establish a data privacy policy detailing entity’s expectation relating to data privacy and the sharing
of confidential information.
4. Conduct fraud awareness training for all existing and new employees.
5. Conduct a separate and comprehensive Fraud Scenario Assessment by the internal audit function
of the entity.
3.4 OUTPUT GROUP 3:
SUPPORTING ACCOUNTABILITY
In 2010, ADAA issued 19 reports under this output. A number of reports were presented to His
Highness the Crown Prince by the Chairman of ADAA on matters arising from annual work and
audits carried by ADAA. Among the reports submitted under this output is this annual Accountability
Report that ADAA completes in the first quarter of each year. The Chairman of ADAA also presented a
number of reports to members of the Executive Council and other key executives in the Government.
Advisory and Assistance
Advisory and Assistance consists of services provided to Subject Entities based on their request and the
approval of ADAA Chairman. ADAA was engaged in a number of Advisory and Assistance projects
and issued reports that included advising Subject Entities on strategic, structural and performance
improvements.

2010 REPORT AND 2011 WORK PLAN 49
Below is an example of such Advisory and Assistance work provided during 2010:
Governance Program
Following ADAA governance review, The Governance Committee was established through the
Executive Council Resolution number (17) of 2010 to supervise the development and implementation
of the frameworks of governance principles presented to the Executive Council by ADAA for Abu Dhabi
Government.
The Committee is tasked to focus on the following 6 areas:
Procurement
Public Service
Finance and Performance Management
IT ERP Infrastructure
SOE Governance
ADAA developed the operating model for the work of the Governance Committee, supported the
development of the detailed program scope, and helped coordinate the various projects under the
Governance Committee.
ADAA also provided technical expertise and research in diverse areas including procurement, public
service, finance, and governance to ensure successful delivery of program outputs. Furthermore,
ADAA is helping the Governance Committee by developing an operating model and implementation
guide for effective governance of SOEs.
Accounting Technical Advice
To improve both the quality and consistency of International Financial Reporting Standards (IFRS) and
International Public Sector Accounting Standards (IPSAS) reporting and understanding within the
finance community of Abu Dhabi, ADAA issues accounting technical position papers that provide
specific guidance to Subject Entities on particular topics.
ADAA also provided specific accounting advice to Subject Entities and through the Abu Dhabi Technical
Forum builds consistency in accounting treatments. In 2010 ADAA issued 36 technical papers on a
multitude of topics.
National and International Representation
ADAA continuously seeks opportunities to gain knowledge about best practices that will assist in
improving accountability and transparency across the Government. Hence, ADAA actively endeavors to
contact national and international organizations that play a similar role or a regulatory and supervisory
role in the fields of accountability, accounting and audit.
ADAA was the first organization in the Middle East to become a member of the International Forum
of Independent Audit Regulators (IFIAR) in early 2009 and in 2010 ADAA hosted IFIAR in Abu
Dhabi, marking the UAE as the first Arab country to host this meeting in its seventh edition with the
attendance of more than 130 representatives from more than 30 jurisdictions worldwide.

2010 REPORT AND 2011 WORK PLAN 50
Accountability Report 2011
ADAA also hosted various delegations from national and international organizations to share
knowledge and get acquainted with best practices as well as attended many events locally and
internationally such as the 11th Annual Gulf Regional Audit Conference of the UAE Internal Audit
Association (IIA) held in Abu Dhabi, the IFIAR 8th meeting held in Madrid, the 2010 Forum of
International Accountancy Regulators held by the National Association of State Boards of Accountancy
“NASBA” and the World Economic Forum Summit on Global Agenda held in Dubai whereby the
Chairman of ADAA participated as a member of the Global Agenda Council on Anti-Corruption after
being requested to join the council earlier in 2010.
3.5 OUTPUT GROUP 4:
SPECIAL EXAMINATION
In 2010, ADAA received 33 complaints from Subject Entities, law enforcement authorities, the Public
and internal departments from ADAA. In 2009 ADAA received 12 complaints. All complaints were
examined as per the Special Examination Methodology outlined by ADAA and in accordance with its’
approved regulations. These examinations resulted in a variety of actions taken and are shown in the
following table:
Based upon the investigations conducted by ADAA in 2010, the Public Prosecution were notified
of two incidents where punitive crimes were committed and required action to be taken by public
prosecution.
All examinations conducted by ADAA in 2009 and 2010 were generally identified as violations related
to the followings:
Abuse of power and conflict of interest.
Violation of procurement laws, regulations and procedures.
Negligence in managing public money.
Breaching code of conduct.
No. Action Taken 2009 2010
1. Conducted investigations 3 5
2. Conducted examinations 8 9
3. Closed the complaint due to inaccuracy or insignificance
of complaint or no-violation
1 16
4. Transferred to responsible entity - out of ADAA scope 0 2
5. Presented technical advice to law enforcement authority 0 1
Total number of Complaints received by ADAA 12 33

2010 REPORT AND 2011 WORK PLAN 51
CASE 1
ADAA received a complaint from an ex-employee at a public shareholding company against a
head of department at a Subject Entity that procured a service from his company claiming that
the head of department had acquired huge commissions that surpassed 290 million dirhams
exceeding 35% of the total value of the contract between the two parties.
Upon conducting an investigation, ADAA validated the allegations filed and found similar
violations with additional companies providing a similar service and the involvement of various
employees from the public shareholding company with the accused Subject Entity head of
department confirming the acquisition of these illegitimate commissions.
ADAA informed the Subject Entity in order to take disciplinary action against the accused
employee and other involved parties as well as notifying the Public Prosecution of the incident
since it was suspected as a punitive crime. The Public Prosecution conducted a criminal
investigation and has filed the case to court.
CASE 2
A law enforcement authority informed ADAA of a violation committed by a chairman deputy at
a Subject Entity whereby the violator issued financial decisions worth over 580 million dirhams
beyond his designated jurisdictions.
Upon examining the violation, ADAA found the deputy had exceeded his delegation of
authority and that in return reversed his decisions and ADAA notified the Subject Entity and law
enforcement authority of the same and of the results of the examination.
CASE 3
ADAA received a complaint from a law enforcement authority against a general manager of a
Subject Entity stating that the he had awarded tenders illegitimately to vendors and had given
direct orders violating provisions regulating procurement laws and regulations.
The investigation conducted by ADAA found documentations confirming the allegations filed
against the general manager and concluded that he violated the procurement laws and regulation,
and code of conduct and business ethics. (During the examination the value of the Subject Entity’s
contracts exceeded 700 million dirham).
ADAA informed the Subject Entity to take disciplinary action against the violators and to inform the
related law enforcement authority to carry forward the investigation in the suspected punitive crime
that resulted in notifying the Public Prosecution of the incident.
Below is a summary of some of ADAA examinations and investigations cases in 2010:

2010 REPORT AND 2011 WORK PLAN 52
Accountability Report 2011
3.6 OUTPUT GROUP 5:
ADAA TRAINING CENTER
In 2010, ADAA re-defined the outputs under this group in order to achieve the main objective of
establishing the ADAA Training Center and created an integrated approach to establishing a center of
excellence that covers training requirements and needs accompanied by a full spectrum of services that
ensures it keeps up-to-date with the latest developments and international best practices.
The outputs defined under this group are:
Qualifying Emirati Auditors
Research and Knowledge Sharing
Workshops and Seminars
3.6.1 Qualifying Emirati Auditors
ADAA Training Center has designed two training programs that will contribute to increasing the number
of qualified Emirati Auditors in the Government and these programs include offering professional
certifications in the accounting and audit profession such as the Certified Public Accountant (CPA)
examination preparation course and the Certified Internal Auditor (CIA) examination preparation course
to UAE Nationals.
It is worth mentioning that ADAA’s two-year initiative to bring the USA CPA examination to the
region and Abu Dhabi has succeeded in October 2010. The National Association of State Boards of
Accountancy “NASBA” informed ADAA that it had agreed to administer this 100 year old exam outside
the USA for the first time and consider Abu Dhabi as a host location; making it accessible to everyone.
Since the inception of the programs ADAA has 23 Emiratis enrolled in their training program and will be
accepting another 10 applications in 2011.
3.6.2 Research and Knowledge Sharing
During the year 2010, ADAA worked on various projects that included base-lining and benchmarking
projects providing new insights on the Abu Dhabi Government, developing research papers,
development of new systems that streamline processes and ensure easy storage and accessibility of
knowledge.
The Research and Knowledge Management (RKM) function at ADAA completed over 120 research
assignments, 2 major baseline surveys, 4 research papers and 10 research primers.
ADAA has launched a number of initiatives to enable knowledge sharing across Abu Dhabi Government
and it’s Subject Entities such as:
E-maarifa
In 2010, ADAA launched the e-maarifa portal with the objective of creating a knowledge platform for
all Subject Entities.

2010 REPORT AND 2011 WORK PLAN 53
The e-maarifa portal (https://www.e-maarifa.ae) was officially launched in 2010 with the Abu Dhabi
Audit Management (ADAM) site being the first collaboration site on the e-maarifa portal. The ADAM
site brought together members of the Internal Audit community across the Abu Dhabi government
to share information and communicate on key issues in the form of documents and discussions. The
ADAM site currently has a membership of more than 300 users across more than 65 Subject Entities.
ADAA Digest
A new look and approach to ADAA’s monthly Accounting Digest (Previously known as the “IFRS
Digest”) was introduced in 2010 with a wider scope of content that included ADAA’s hot topics, what’s
new from the IASB and IPSASB and the accounting profession, related party transactions, accounting for
transactions with government, non cash transfers of assets and much more.
The Digest fits on one page and includes web links to publications where further information can be
found on the subjects highlighted. The ADAA Digest also introduced a specialist IFRS “Help Desk” that
receives internal and external requests for help and advice on the interpretation of current and existing
standards and interpretations and releases a technical paper accordingly to the concerned party.
Global Accountability and Transparency
ADAA issues a monthly newsletter under the title “Global Accountability and Transparency” whereby
various topics and research papers are covered and discussed.
Practice Guides
During 2010, ADAA issued the Internal Audit Better Practice Guide that is intended to assist the
Internal Audit functions at Subject Entities to operate in a consistent and unified framework based on
international best practices.
3.6.3 Workshops and Seminars
ADAA provides workshops and seminars to Subject Entities and the public on matters that complement
its primary role and fall within its area of expertise. Below is a summary of ADAA activities in 2010
related to this output:
Abu Dhabi Technical Forum (ADTF)
ADAA initiated this forum that is chaired by ADAA’s Head of Accounting and Auditing Standards
which brings together the Abu Dhabi based technical partners of the international accounting firms.
Discussions focus on current and expected problematic accounting treatments. The aim of the forum is
to eliminate the local inconsistency in application of accounting standards by building consensus on the
interpretation of accounting standards and the acceptability (or not) of accounting treatments, thereby
improving the comparability and quality of financial reporting in Abu Dhabi.
Internal Audit Seminar
The 2nd Internal Audit Seminar was held in February 2010 and was attended by key people in the
Internal Audit function from around 60 Subject Entities and discussed challenges in the profession,
process, internal controls, policies, issues and an introduction to SAAR as well as knowledge sharing of
best practices and developments.

2010 REPORT AND 2011 WORK PLAN 54
Accountability Report 2011
Panel Discussions and Workshops
ADAA conducted a panel discussion on the Financial Management Assessment for over 60 key
representatives from the financial function at Subject Entities to explain the FMA process, the objective,
benefits and address queries by participants. It also hosted two workshops for representatives from the
Abu Dhabi Judicial Department that were introduced to ADAA services with an emphasis on the Special
Examinations output.
3.7 2011 WORKPLAN
ADAA will execute its’ 2011 annual plan to ensure the delivery of timely and relevant services on issues
that add value to its stakeholders as summarized below:
Issue 85 Financial Audits and Examinations reports.
Issue 83 Performance and Risk Assurance reports.
Issue 20 Supporting Accountability reports.
Issue 10 Special Examination reports.
Issue the audit report on the consolidated financial statements of the Government within the time-
frame specified in the Financial Management Law.
Complete all services and methodologies under the “Supporting Accountability” and the “ADAA
Training Center” output groups.
Recruit 10 UAE National Graduates.
Enhance and unify Subject Entities financial statements basis of preparation according to Subject
Entities’ operations and aligned with international standards.
Address complex accounting matters and unify interpretations of financial reporting standards
through the Abu Dhabi Technical Forum.
Continue assisting the Government and the Governance Committee in establishing ADAA
recommended integrated governance framework.
Continue assisting Subject Entities to build their capabilities in internal audit, business and fraud
risk management and governance.
Monitor compliance of Subject Entities with SAAR.
Strengthen the financial management function within Subject Entities through conducting more
Financial Management Assessments (FMA).
Monitor outputs and outcomes and related performance indicators to ensure that stakeholders
and Subject Entities needs are being met.
Continue coordination with international peers for knowledge sharing and for adoption of best
practices.
Further development of the e-maarifa portal to include new sites as well as improving the currently
existing ADAM site.

2010 REPORT AND 2011 WORK PLAN 55
Publish “Fraud Scenario Assessment (FSA)” methodology.
Continue to advise and assist Government entities to develop their Anti-Fraud framework.
Identify and address the common vulnerabilities across Subject Entities.
Develop and assist in the implementation of the Fraud Control Policy in Subject Entities.
* Certain comparative numbers have been reclassified to conform to current year’s output group presentation.
** The total cost represents ADAA budget (target) and actual as per ADAA audited financial statements and include the cost of
other ADAA outputs.
No. Description
Actual
2010
Target
2011
1 Financial Audit and Examination 96 85
2 Performance and Risk Assurance 83 83
3 Supporting Accountability 19 20
4 Special Examination 15 10
5 ADAA Training Center NA NA
Total Number of Reports 213 198
Total Cost (AED)** 110,287,672 136,237,000

PART FOUR
Accountability Report 2011
2010 AUDITED
FINANCIAL
STATEMENTS

2010 AUDITED FINANCIAL STATEMENTS 57
ADAA 2010 AUDITED FINANCIAL STATEMENTS

2010 AUDITED FINANCIAL STATEMENTS 58
Accountability Report 2011
FINANCIAL STATEMENTS TOGETHER
WITH AUDITORS� REPORT
31 DECEMBER 2010
2010 AUDITED
FINANCIAL STATEMENTS

2010 AUDITED FINANCIAL STATEMENTS 59

2010 AUDITED FINANCIAL STATEMENTS 60
Accountability Report 2011
Page
1. Statement of financial position 1
2. Statement of financial performance 2
3. Statement of changes in Government of Abu Dhabi account 3
4. Cash flow statement 4
5. Statement of comparison of budget and actual amounts 5
6. Notes to the financial statements 6 - 18
TABLE OF CONTENTS

2010 AUDITED FINANCIAL STATEMENTS 61
Abu Dhabi Accountability Authority
STATEMENT OF FINANCIAL POSITION
As at 31 December 2010
Page 1 of 18
Notes
2010
AED
2009
AED
ASSETS
Current assets
Bank balances and cash 4 25,058,433 43,853,426
Debtors and other debit balances 5 7,952,158 7,858,146
33,010,591 51,711,572
Non-current assets
Property and equipment, net 6 4,716,435 5,991,753
Intangible assets, net 7 1,315,047 2,617,180
6,031,482 8,608,933
TOTAL ASSETS 39,042,073 60,320,505
LIABILITIES
Current liabilities
Payables and other credit balances 8 3,797,752 15,529,357
Government of Abu Dhabi account 23,712,052 32,892,635
27,509,804 48,421,992
Non-current liabilities
Employees’ end of service benefits 9 11,532,269 11,898,513
TOTAL LIABILITIES 39,042,073 60,320,505
The financial statements were authorised for issue in accordance with a resolution of the Authority’s
Chairman on 9 February 2011.
Mohammad Saif Al Muheiri Riyad Abdulrahman Al Mubarak
Director of Finance Chairman
The attached notes 1 to 15 form part of these financial statements.

2010 AUDITED FINANCIAL STATEMENTS 62
Accountability Report 2011
Abu Dhabi Accountability Authority
STATEMENT OF FINANCIAL PERFORMANCE
For the year ended 31 December 2010
Page 2 of 18
Notes
2010
AED
2009
AED
Revenues
Contribution from Government of Abu Dhabi 11 109,180,583 103,057,049
Other income 1,107,089 16,420
Total revenues 110,287,672 103,073,469
Expenditures
Salaries, wages and other benefits 92,492,625 75,651,058
Employees’ end of service benefits 9 2,588,251 3,357,972
Depreciation and amortization 4,175,396 4,004,178
General and administrative expenses 10 11,031,400 20,060,261
Total expenditures 110,287,672 103,073,469
The attached notes 1 to 15 form part of these financial statements.

2010 AUDITED FINANCIAL STATEMENTS 63
Page 3 of 18
Abu Dhabi Accountability Authority
STATEMENT OF CHANGES IN GOVERNMENT OF ABU DHABI ACCOUNT
For the year ended 31 December 2010
2010
AED
2009
AED
Balance at 1 January 32,892,635 40,949,684
Funds received during the year 100,000,000 95,000,000
Contribution recognized as revenue during the year (109,180,583) (103,057,049)
Balance at 31 December 23,712,052 32,892,635
The attached notes 1 to 15 form part of these financial statements.

2010 AUDITED FINANCIAL STATEMENTS 64
Accountability Report 2011
Page 4 of 18
Abu Dhabi Accountability Authority
CASH FLOW STATEMENT
For the year ended 31 December 2010
Notes
2010
AED
2009
AED
CASH FLOWS FROM OPERATING ACTIVITIES
Adjustments for non-cash items:
Depreciation and amortization 4,175,396 4,004,178
Provision for employees’ end of service benefits 9 2,588,251 3,357,972
Gain on sale of property and equipment (38,000) (16,420)
(Increase) Decrease in debtors and other debit
balances (94,012) 1,284,367
(Decrease) Increase in payables and other credit
balances (11,731,605) 1,628,066
Decrease in Government of Abu Dhabi account (9,180,583) (8,057,049)
Employees’ end of service benefits paid 9 (2,954,495) (1,574,482)
Net cash flows (used in) from operating activities (17,235,048) 626,632
CASH FLOWS USED IN INVESTING ACTIVITIES
Purchase of property and equipment 6 (1,511,192) (998,322)
Purchase of intangible assets 7 (86,753) (36,300)
Proceeds from sale of property and equipment 38,000 16,420
Net cash used in investing activities (1,559,945) (1,018,202)
DECREASE IN CASH AND CASH EQUIVALENTS (18,794,993) (391,570)
Cash and cash equivalents at the beginning of the
year 43,853,426 44,244,996
CASH AND CASH EQUIVALENTS AT THE END
OF THE YEAR 4 25,058,433 43,853,426
The attached notes 1 to 15 form part of these financial statements.

2010 AUDITED FINANCIAL STATEMENTS 65
Page 5 of 18
Abu Dhabi Accountability Authority
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS
For the year ended 31 December 2010
The attached notes 1 to 15 form part of these financial statements.
Description
2010
Final
budget amounts
AED
Actual
amounts on
comparable basis
AED
Difference
surplus (deficit)
AED
RECEIPTS
Contribution from Government of Abu Dhabi 136,237,000 100,000,000 36,237,000
Revenue from non-subject entities - 1,069,089 (1,069,089)
Total Receipts 136,237,000 101,069,089 35,167,911
EXPENDITURES
Chapter one - Salaries, wages and other benefits
Basic salary and other allowances 85,361,270 83,586,691 1,774,579
Tuition allowance 2,640,000 2,311,505 328,495
Contributions to pension fund and retirements benefit plan 3,655,000 2,413,572 1,241,428
End of service benefits 3,600,000 2,588,251 1,011,749
Medical insurance 2,250,000 2,154,259 95,741
Staff training 3,020,000 708,083 2,311,917
Other expenses 1,126,730 290,878 835,852
Total salaries, wages and other benefits/surplus from
chapter one 101,653,000 94,053,239 7,599,761
Chapter two – Other operating expenditure
Recruitment fees 1,300,000 483,037 816,963
Consultancy fees 11,160,000 2,076,449 9,083,551
Office rent and other related expenses 5,465,000 3,652,700 1,812,300
Motor vehicles expenses (insurance, maintenance and fuel) 170,000 59.736 110,264
Operation and maintenance of computers, furniture and office
equipment 1,275,000 1,349,984 (74,984)
Books and professional and scientific subscription 120,000 23,387 96,613
Advertising and corporate identity expenses 1,830,000 796,050 1,033,950
Business travel expenses 1,840,000 1,090,021 749,979
Miscellaneous expenses 6,359,000 1,489,075 4,869,925
Total other operating expenditure/ surplus from chapter two 29,519,000 11,020,439 18,498,561
NET OPERATING RECEIPTS (PAYMENTS) 5,065,000 (4,004,589) 9,069,589
Chapter three - Capital expenditure
Motor vehicles 200,000 140,000 60,000
Furniture and office equipment 650,000 695,399 (45,399)
Computer equipment 2,350,000 617,443 1,732,557
Leasehold improvements 500,000 58,350 441,650
Intangible assets 1,365,000 86,753 1,278,247
Proceeds from sale of property and equipment - (38,000) 38,000
Total capital expenditure/ surplus from chapter three 5,065,000 1,559,945 3,505,055
NET RECEIPTS/(PAYMENTS) - (5,564,534) 5,564,534
Note: The budget and the financial statements are prepared using a different basis. The actual amounts on comparable basis above
were prepared on the same basis adopted for budget: “modified cash basis”. Additional information about the approved budget
and a reconciliation of amounts as per the above statement and the actual amounts in the statement of cash flows are disclosed in
Note 15 to the financial statements.

2010 AUDITED FINANCIAL STATEMENTS 66
Accountability Report 2011
Page 6 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
1 GENERAL
Abu Dhabi Accountability Authority (the “Authority”) is an independent Governmental entity,
established in accordance with the Law No. (14) for the year 2008, which was issued to replace
Abu Dhabi Audit Authority.
The Authority’s principal activity is to:
Ensure that public entities’ resources and funds are managed, collected and expended efficiently,
effectively and economically.
Ensure accuracy of the financial reports and compliance of the public entities with the relevant
laws, rules and regulations and governance guidelines.
Promote accountability and transparency principles across all public entities.
The Authority’s registered head office is at Falcon Tower-Hamdan Bin Mohamed Street, P.O. Box 435,
Abu Dhabi, United Arab Emirates.
At 31 December 2010, the Authority had 138 employees (2009: 143 employees).
2 BASIS OF PREPARATION OF FINANCIAL STATEMENTS
2.1 Basis of Preparation
The financial statements have been prepared in accordance with International Public Sector Accounting
Standards (IPSAS). Where an International Public Sector Accounting Standard does not address a
particular issue, the relevant International Financial Reporting Standard has been applied.
The financial statements are prepared under the historical cost convention.
The financial statements have been presented in United Arab Emirates Dirhams (“AED”) which is the
functional currency of the Authority.
2.2 Changes in Accounting Policies and Disclosures
The accounting policies adopted are consistent with those of the previous financial year except as
follows:
IPSAS 4 The Effects of Changes In Foreign Exchange Rates (Revised) – Effective from 1 January
2010, the revision mainly clarifies and provides additional guidance on recognition of exchange

2010 AUDITED FINANCIAL STATEMENTS 67
Page 7 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
2.2 Changes in Accounting Policies and Disclosures continued
differences arising from net investment in a foreign operation. Since the Authority has no investment
in a foreign operation and the fact that the presentation and functional currency of the Authority is
same, the adoption of revised standard has no impact on the statements of financial performance and
position of the Authority.
IPSAS 31 Intangible Assets – The new standard is effective from 1 April 2011 and provides
comprehensive guidance on identifying, recognizing, measuring and making related disclosures for
intangible assets.
The Authority has early adopted IPSAS 31 with retrospective effect. Since the Authority has previously
recognized intangible assets applying the requirements of IAS 38 “Intangible Assets”, the early
adoption of IPSAS 31 has no impact on the statements of financial performance and position of the
Authority.
IPSAS 24 Presentation of Budget Information in Financial Statements – In order to enhance the
accountability and transparency of the Financial Statements, the Authority has voluntarily adopted
IPSAS 24 with effect from 1 January 2010.
The adoption of IPSAS 24 requires an additional statement and several new disclosures. In particular, a
statement of comparison of budget and actual amounts is presented in the financial statements on a
comparable basis. As the adoption of IPSAS 24 only impacts the presentation of financial statements,
there is no impact on the statements of financial performance and position of the Authority.
Comparative figures for the statement of comparison of budget and actual amounts and other related
disclosures have not been presented as allowed under paragraph 52 of IPSAS 24.
2.3 Future Changes in Accounting Policies - International
Public Sector Accounting Standards (IPSAS) Issued but
not Applied
The Authority has not applied the following new or revised IPSAS issued but not effective for the year
ended 31 December 2010:
IPSAS 25 Employee Benefits.
IPSAS 27 Agriculture
IPSAS 28 Financial Instruments: Presentation
IPSAS 29 Financial Instruments Recognition and Measurement
IPSAS 30 Financial Instruments Disclosures
Improvements to IPSASs (November 2010)

2010 AUDITED FINANCIAL STATEMENTS 68
Accountability Report 2011
Page 8 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
The adoption of the above new or revised IPSAS and improvements will have no impact on the
financial position or performance of the Authority. However, they will give rise to amendments to the
presentation of the financial statements and additional or amended disclosures.
2.4 Estimation Uncertainty and Judgement
The key assumptions concerning the future benefits and other key sources of estimation that are
uncertain at the date of the financial statements, that have a significant risk of causing a material
adjustment to the carrying amounts in the financial statements within the next financial year are
presented below:
Impairment of debtors and other debit balances
An estimate of the collectible amount of debtors and other debit balances is made when collection
of the full amount is not probable. For individually significant amounts, this estimation is performed
on an individual basis. Amounts which are not individually significant, and are past due, are assessed
collectively and a provision applied according to the length of time past due. At 31 December 2010
gross debtors and other debit balances were AED 7,952,158 (2009: AED 7,858,146) with no provision
for doubtful debts (2009: nil).
Useful lives of property and equipment
The Authority’s management determines the estimated useful lives of its property and equipment for
calculating depreciation. This estimate is determined after considering the expected usage of the asset
and physical wear and tear. Management reviews the residual value and useful lives annually and
future depreciation charge would be adjusted where the management believes the useful lives differ
from previous estimates. The net carrying amount of property and equipment at 31 December 2010
was AED 4,716,435 (2009: AED 5,991,753).
Useful live of intangible asset
The Authority’s management determines the estimated useful live of intangible assets for calculating
amortization. This estimate is determined after considering the expected pattern of consumption
of the future economic benefits or service potential embodied in the asset. Management reviews
the residual value and useful live annually and future amortization charge would be adjusted where
the management believes the useful lives differ from previous estimates. The net carrying amount of
intangible assets at 31 December 2010 was AED 1,315,047 (2009: AED 2,617,180).
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3.1 Revenue Recognition
Contribution from Government of Abu Dhabi
Funds received from the government are credited to the Government of Abu Dhabi account. The
amount of contribution recognized as revenues in the statement of financial performance is equivalent
to the extent of the expense incurred for the year less other income.

2010 AUDITED FINANCIAL STATEMENTS 69
Page 9 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
3.1 Revenue Recognition continued
Revenue from services
Revenue from rendering of services is recognized when the outcome of the transaction can be
estimated reliably, by reference to the stage of completion of the transaction at the date of the
statement of financial position.
3.2 Property and Equipment
Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated on
a straight line basis over the estimated useful lives of the assets as follows:
The carrying amounts are reviewed for impairment when events or changes in circumstances indicate
the carrying value may not be recoverable. If any such indication exists and where the carrying values
exceed their estimated recoverable service amount, the assets are written down to their recoverable
amount. The excess of carrying value over recoverable amount is recognized as an impairment loss.
3.3 Intangible Assets
Intangible assets represent computer software, and are carried at cost less accumulated amortization.
Intangible assets are amortized on a straight line basis over their useful economic lives of 3 years.
The carrying amounts are reviewed for impairment when events or changes in circumstances indicate
the carrying value may not be recoverable. If any such indication exists and where the carrying values
exceed their estimated recoverable service amount, the assets are written down to their recoverable
service amount. The excess of carrying value over recoverable service amount is recognized as an
impairment loss.
3.4 Debtors and Other Debit Balances
Debtors are stated at original invoice amount less a provision for any uncollectible amounts. An
estimate for doubtful debts is made when collection of the full amount is no longer probable. Bad
debts are written off when there is no possibility of recovery.
Years
Motor vehicles 4
Furniture and fixtures 4
Computers 3
Leasehold improvements 4
Machinery and office equipment 3

2010 AUDITED FINANCIAL STATEMENTS 70
Accountability Report 2011
Page 10 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
3.5 Payables and Other Credit Balances
Liabilities are recognized for amounts to be paid in the future for goods received or services provided,
whether billed by the supplier or not.
3.6 Provisions
Provisions are recognized when the Authority has an obligation (legal or constructive) arising from a
past event, and the costs to settle the obligation are both probable and able to be reliably measured.
3.7 Employees’ End of Service Benefits
Employees’ end of service benefits are calculated according to the human resources policies adopted by
the Authority and are classified as non-current liabilities, which is based on the liability that could arise on
termination of the services of all employees at the date of the financial statements, with the exception of
UAE nationals, who are subject to the provisions of Law No. (2) for the year 2000 (as amended) relating
to civil pensions and retirement benefits in the Emirate of Abu Dhabi.
3.8 Cash and Cash Equivalents
Cash and cash equivalents consist of cash in hand, bank balances, and deposits with an original maturity
of three months or less.
3.9 Foreign Currencies
Transactions in foreign currencies are initially recorded at the rate prevailing at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are retranslated at the spot rate of
exchange prevailing at the date of the statement of financial position. All foreign exchange differences
are taken to the statement of financial performance.

2010 AUDITED FINANCIAL STATEMENTS 71
Page 11 of 18
4 BANK BALANCES AND CASH
5 DEBTORS AND OTHER DEBIT BALANCES
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
2010
AED
2009
AED
Bank balances and cash 25,050,433 43,846,407
Petty cash 8,000 7,019
25,058,433 43,853,426
2010
AED
2009
AED
Prepaid expenses 2,289,779 1,638,655
Advances and loans to employees 4,868,218 4,913,062
Other debtors 794,161 1,306,429
7,952,158 7,858,146

2010 AUDITED FINANCIAL STATEMENTS 72
Accountability Report 2011
Page 12 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
6 PROPERTY AND EQUIPMENT
Motor
vehicles
AED
Furniture
and
fixtures
AED Computers
AED
Leasehold
improvements
AED
Machinery
and office
equipment
AED Total
AED
2010
Cost:
As at 1 January 2010 680,000 1,957,342 3,388,466 3,749,529 1,198,282 10,973,619
Additions 140,000 617,579 617,443 58,350 77,820 1,511,192
Disposals (125,000) - - - - (125,000)
As at 31 December 2010 695,000 2,574,921 4,005,909 3,807,879 1,276,102 12,359,811
Accumulated depreciation:
As at 1 January 2010 606,342 616,224 1,925,793 1,161,653 671,854 4,981,866
Depreciation for the year 69,050 503,246 986,064 943,442 284,708 2,786,510
Disposals (125,000) - - - - (125,000)
As at 31 December 2010 550,392 1,119,470 2,911,857 2,105,095 956,562 7,643,376
Net carrying amount:
As at 31 December 2010 144,608 1,455,451 1,094,052 1,702,784 319,540 4,716,435
2009
Cost:
As at 1 January 2009 680,000 1,897,082 3,411,802 4,843,738 790,996 11,623,618
Additions - 60,260 512,901 17,875 407,286 998,322
Disposals - - (536,237) (1,112,084) - (1,648,321)
As at 31 December 2009 680,000 1,957,342 3,388,466 3,749,529 1,198,282 10,973,619
Accumulated depreciation:
As at 1 January 2009 481,389 151,993 1,580,551 1,356,522 424,202 3,994,657
Depreciation for the year 124,953 464,231 881,479 917,215 247,652 2,635,530
Disposals - - (536,237) (1,112,084) - (1,648,321)
As at 31 December 2009 606,342 616,224 1,925,793 1,161,653 671,854 4,981,866
Net carrying amount:
As at 31 December 2009 73,658 1,341,118 1,462,673 2,587,876 526,428 5,991,753

2010 AUDITED FINANCIAL STATEMENTS 73
Page 13 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
7 INTANGIBLE ASSETS
Computer Software
2010
AED
2009
AED
Cost:
As at 1 January 4,126,717 4,090,417
Additions 86,753 36,300
As at 31 December 4,213,470 4,126,717
Accumulated amortization:
As at 1 January 1,509,537 140,889
Amortization for the year 1,388,886 1,368,648
As at 31 December 2,898,423 1,509,537
Net book value:
As at 31 December 1,315,047 2,617,180
8 PAYABLES AND OTHER CREDIT BALANCES
2010
AED
2009
AED
Trade payables 2,025,695 13,297,740
Accrued expenses 1,772,057 2,231,617
3,797,752 15,529,357
9 EMPLOYEES’ END OF SERVICE BENEFITS
2010
AED
2009
AED
Balance as at 1 January 11,898,513 10,115,023
Charge for the year 2,588,251 3,357,972
End of service benefits paid during the year (2,954,495) (1,574,482)
Balance as at 31 December 11,532,269 11,898,513

2010 AUDITED FINANCIAL STATEMENTS 74
Accountability Report 2011
Page 14 of 18
Related party transactions represent transactions with the Government of Abu Dhabi, senior management
of the Authority and companies in which they are principal owners or over which they exercise significant
influence.
Transactions with related parties included in the statement of financial performance are as follows:
Government of Abu Dhabi
Compensation of key management personnel
Key management personnel comprise the Chairman, the Executive Directors and the Department Heads.
The remuneration of key management and their number are as follows:
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
10 GENERAL AND ADMINISTRATIVE EXPENSES
11 RELATED PARTY TRANSACTIONS
2010
AED
2009
AED
Business travel 1,090,021 726,661
Recruitment fees 482,037 1,073,091
Consultancy fees 2,364,293 12,295,551
Rent 2,248,008 1,915,686
Telephone and internet 924,068 904,269
Computer maintenance 1,163,765 1,607,855
Other expenses 2,759,208 1,537,148
11,031,400 20,060,261
2010 2009
Salaries and other benefits AED 13,445,415 AED 13,684,063
Employees’ end of service benefits AED 469,547 AED 333,546
Number of key management personnel 9 9
2010
AED
2009
AED
Contribution from Government of Abu Dhabi 109,180,583 103,057,049

2010 AUDITED FINANCIAL STATEMENTS 75
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Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
12 COMMITMENTS AND CONTINGENCIES
As at 31 December 2010, the Authority had no capital commitments, which are contracted but not
provided for (2009: AED 20,900).
13 FINANCIAL RISK MANAGEMENT OBJECTIVES
AND POLICIES
13.1 Currency Risk
The foreign currency risk is the risk of fluctuation of the value of financial instruments due to changes in
the foreign exchange rates.
The Authority manages its bank accounts in Dirhams, which is the official currency of the United Arab
Emirates, and therefore management believes that the Authority has no exposure to currency risk.
13.2 Interest Rate Risk
Interest rate risk arises from possible impact of changes in the interest rates on the value of financial
instruments. The Authority does not have assets and liabilities that are materially dependent on interest
rate levels, therefore, management believes that the Authority has no exposure to interest rate risk.
13.3 Credit Risk
Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause
the other party to incur a financial loss.
The Authority is exposed to credit risk on its debtors account. The Authority seeks to reduce the credit
risk by setting customer credit limits for customers and monitoring existing outstanding debtors balances.
14 FAIR VALUES OF FINANCIAL INSTRUMENTS
Financial instruments include financial assets and financial liabilities, financial assets include cash and
bank balances, debtors and other debit balances, and financial liabilities include payables and other credit
balances.
The fair values of financial assets and liabilities are not materially different from their carrying values since
financial assets and liabilities are of a short-term nature.

2010 AUDITED FINANCIAL STATEMENTS 76
Accountability Report 2011
Page 16 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
15 STATEMENT OF COMPARISON OF BUDGET AND
ACTUAL AMOUNTS
15.1 The Authority’s budget is prepared on a modified cash basis which combines elements of cash
and accrual method. The approved budget for all individual categories encompasses expected
expenditures during the year but excludes any payments for prior years’ obligations, except
for the budget of end of service benefits which represents expected charge for the year. The
budget is prepared using a classification based on the nature of expenses and covers the same
period (1 January to 31 December) as the financial statements. The budget was approved by HH
Abu Dhabi Crown Prince Chairman of the Abu Dhabi Executive Council, and was included in
the Government budget in accordance with the Executive Council resolution Number 1 meeting
1/2010 issued on 15 February 2010.
15.2 The Authority’s budget and financial statements are prepared using a different basis. The
financial statements are prepared on the accrual basis using a classification based on the nature
of expenses in the statement of financial performance, whereas the budget is prepared on
a modified cash basis. The amounts in the financial statements were recast from the accrual
basis to the modified cash basis and reclassified by presentation to be on the same basis as the
approved budget. A comparison of budget and actual amounts, prepared on a comparable
basis to the approved budget, is then presented in the statement of comparison of budget and
actual amounts.
15.3 As required under IPSAS 24, the actual amounts presented on a comparable basis to the budget
shall, where the financial statements and the budget are not prepared on a comparable basis,
be reconciled to the actual amounts presented in the financial statements, identifying separately
any basis, timing and entity differences.
15.4 Basis differences occur when the approved budget is prepared on a basis other than the
accounting basis. For the Authority, the budget is prepared on the modified cash basis and the
financial statements are prepared on the accrual basis.
15.5 Timing differences occur when the budget period differs from the reporting period reflected in
the financial statements. There are no timing differences for the Authority as the budget period
and the reporting period reflected in the financial statements are the same.
15.6 Entity differences occur when the budget omits programs/ activities or entities that are part of
the entity for which the financial statements are prepared.
15.7 Presentation differences are due to differences in the format and classification schemes adopted
for presentation of statement of cash flow and statement of comparison of budget and actual
amounts.

2010 AUDITED FINANCIAL STATEMENTS 77
Page 17 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
15.8 A reconciliation between the actual amounts on a comparable basis as presented in the
statement of comparison of budget and actual amounts and the actual amounts in the
statement of cash flows for the year ended 31 December 2010 is presented below.
15.9 Payments relating to obligations incurred in prior year are included as part of basis differences. In
addition, the difference between the charge for the end of service benefits (‘EOSB’) and actual
amount paid is also reflected as a basis difference. The details of basis differences are as follows:
15.10 Entity differences represent payments of housing loans to employees of AED 999,395.
2010 Operating
AED
Investing
AED
Financing
AED
Total
AED
Actual amount on comparable basis as
presented in the statement of budget and
actual amounts (4,004,589) (1,559,945) - (5,564,534)
Basis differences (12,231,064) - (12,231,064)
Entity differences (999,395) - - (999,395)
Actual amount in the cash flow
statement (17,235,048) (1,559,945) - (18,794,993)
2010 Operating
AED
Obligations of prior years’ activities paid during the year (11,864,820)
Difference between EOSB charge and amount paid (366,244)
Total (12,231,064)

2010 AUDITED FINANCIAL STATEMENTS 78
Accountability Report 2011
Page 18 of 18
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2010
15.11 Explanation of Differences Between Actual Amounts
and Budget
The total budget surplus around of AED 30 million and individual surplus reported at each of the
above defined budget chapter is primarily attributable to close focus on reducing current year
expenditure. This has involved certain activities being deferred for future periods, current year
expenditures being reduced and ongoing savings being achieved in contracts with suppliers.
The immaterial deficit reported in the budget of operation, maintenance and capital expenditure
for furniture and office equipment is primarily driven from the recent expansion of the
Authority’s office by way of occupying an additional floor.
Due to the current and past surplus reported and availability of cash and bank balances at the
beginning of the year, the Authority requested a contribution of AED 100 million from the
Government of Abu Dhabi as opposed to an approved and available budget of AED 136.2
million for the year 2010.

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