Accountability Report 2012

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Accountability Report

20
12
Accountability
Report

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

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

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12
Accountability
Report

CONTENTS
CONTENTS
FOREWORD 08
PART ONE 10
ABOUT ADAA
1.1 Overview
1.2 Subject Entities
1.3 Functions, Priorities and Outcomes
1.4 Governance Report
PART FOUR 58
2011 AUDITED
FINANCIAL STATEMENTS
PART THREE 36
2011 REPORT AND 2012 WORK PLAN
3.1 2011 Acheivements Highlight
3.2 Financial Audit and Examination Outputs
3.3 Performance and Risk Assurance Outputs
3.4 Supporting Accountability Outputs
3.5 ADAA Training Center Outputs
3.6 2012 Work Plan
PART TWO 24
ADAA´s OUTPUTS
2.1 Financial Audit and Examination
2.2 Performance and Risk Assurance
2.3 Supporting Accountability
2.4 ADAA Training Center

Accountability Report 2012 8
H.E. Riyad Al Mubarak
ADAA Chairman

FOREWORD 9
FOREWORD
FOREWORD
It gives us great pleasure to present for the fourth
consecutive year our Accountability Report 2012,
hoping its content will manifest the transparency
and accountability that we’ve promised to sustain
and aspire to achieve in all our work.
2011 was unquestionably a challenging and
eventful year both locally and internationally, and
has been for ADAA a significant turning point.
We tested our service’s and work methodologies,
exploring new ways to further develop them in
accordance with the latest best practices in order
to ensure the accuracy, clarity and relevance
of our outputs to achieve our mandate and
responsibilities outlined in our establishment law.
The continuous pursuit to progress, persistence to
achieve and great aspirations; are not principles
exclusive to ADAA, they are a lifestyle we grew
accustomed to, a vision of a leadership we admire
and the spirit of a union which established a
country that celebrated its 40th anniversary last
year.
The 2nd of December marked our 40th
anniversary celebration of the Union and the
establishment of the U.A.E. making it the
highlight of 2011 which is the first thing we
proudly remember upon recalling the events
of the previous year. Therefore we take this
opportunity to congratulate the UAE, our rulers
and the people once again with our prayers to
Allah to perpetuate security and prosperity.
A clear vision with the right support facilitate
implementation and transform goals to
achievements; and we are fortunate to have the
clear vision of His Highness Sheikh Khalifa bin
Zayed Al Nahyan, President of the UAE and Ruler
of Abu Dhabi along with the unparalleled support
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 that enabled us to realize our goals and
transform them into achievements, of which we
mention a few below:
ADAA issued 212 reports across all of its
output groups.
ADAA was elected by members of the
International Forum of Independent Audit
Regulators (IFIAR) to sit on its Advisory
Council making the UAE the first Arab
country to become a member.
ADAA alongside the National Association
of State Boards of Accountancy “NASBA”
announced the commencement of the
US Certified Public Accountant (CPA)
Examinations in Abu Dhabi and the region.
ADAA received the “Outstanding
Contribution” award at the 1st Middle East
Accountancy and Finance Excellence Award.
We do not want to expand on our achievements
here and hope that you accept our invitation to
find out more about ADAA by going through this
report. We present in part 1 and 2 of this report
what we consider the foundations and essentials
necessary to accomplish our goals, followed
by the implementation of our plan during the
previous year and our aspirations for 2012,
concluded with our audited financial statements
presented transparently.
Finally, I reiterate our gratitude and pride to our
wise leadership, our appreciation to our Subject
Entities for their cooperation and interaction and
my thankfulness to ADAA employees for their
tremendous efforts in the previous year.
Riyad Al Mubarak
Chairman

PART ONE
ABOUT ADAA

ABOUT ADAA 11
1.1 Overview
1.2 Subject Entities
1.3 Functions, Priorities and Outcomes
1.4 Governance Report

Accountability Report 2012 12
ABOUT ADAA
1.1 OVERVIEW
1.1.1 History
The Abu Dhabi Accountability Authority “ADAA” was established on 18th December 2008 as an
independent body reporting to His Highness the Crown Prince of Abu Dhabi, and replacing the Financial
Audit Authority that was first established pertaining to law No. (1) announced on 12th January 1985.
The first law to establish The Financial Audit Authority stated that it be established as an independent
body reporting to the Crown Prince and limited its mandate to include performing a financial audit
on the funds of Public Entities and ensuring that these funds are managed efficiently and legitimately,
with no reference to the provision of performance and risk reviews or advisory and assistance and it did
not include training and development of UAE Nationals in Accounting and Audit. The Authority began
implementation of its mandate on 15th April 1997 based on the amendments to law No. (1) of its
establishment.
1.1.2 Mandate and Strategic Pillars
Our Vision “ To be one of the top 5 accountability authorities in the world “
Our Mission “ 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“
Our Values
PART ONE
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
INTEGRITY AND RESPECT
PROFESSIONALISM
ACCOUNTABILITY AND TRANSPARENCY

Our Mandate
Ensuring Public Entities’ resources and funds are managed, collected and expended efficiently,
effectively, economically and ethically.
Ensuring accuracy of the financial reports and compliance of Public Entities with relevant laws, rules
and regulations and governance guidelines.
Promoting accountability and transparency across all Public Entities.
ABOUT ADAA 13
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.
PART ONE
Strategic Goals
1. Promote
Governance,
Accountability and
Transparency
2. Enhance
Performance
3. Maintain and
Promote Leading
Practices
4. 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.

Accountability Report 2012 14
People
ADAA views its people as its primary asset, top-tier professionals from multi-cultural backgrounds,
unified by the ADAA vision, mission and values.
ADAA is committed to develop and attract Emiratis to the Accounting and Audit profession. The
Authority has equally defined career paths and growth plans for all employees and promotes the success
of ADAA as one team.
1.1.3 Organization Structure
ADAA’s structure is based on its operating model designed to fulfill its strategic goals:
Internal Audit
Support Services
Group
Performance &
Risk Assurance
Group
Financial Audit
& Professional
Regulation Group
Legal Affairs &
Investigations
Departement
Chairman
Deputy
Chairman

15
PART ONE
ABOUT ADAA
1.2 SUBJECT ENTITIES
ADAA Subject Entities comprise of local departments, councils, authorities and other similar entities. In
addition to 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 undertake special projects at other entities subject to other criteria as per its mandate.
Subject Entities Classification
AD Police AD Education
Council
Urban Planning
Council
Department
of Economic
Development
ADSIC Department
of Finance
Critical National
Infrastructure
Authority
AD Center
for Vocational
Education
AD Sports
Council
Department
of Municipal
Affairs
AD Economic
Development
Council
Water &
Electricity Bureau
Civil Service
Council
Department of
Transport
Musanada Zones
Corporation
AD Tawteen
Council
AD Authority
for Tourism &
Culture
AD Food Control
Authority
AD Media
Authority
Health Authority
- AD
Environment
Agency - AD
SOEs
Subsidiaries
(Approx. 160 )
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
Government Entities Subsidiaries (34 Entities)
Courts
(Diwans)
Central
Government
Executive
Council
Ruler Court Crown Prince
Court
Ruler
Representatives
Courts
Department
of Judiciary
Abu Dhabi
Accountability
Authority
National
Consultative
Council
State Owned
Enterprises (SOE)

Accountability Report 2012 16
Abu Dhabi Quality and Conformity Council
Khalifa Fund for Projects Development
Western Region Development Council
Emirates Heritage Club
Dar Zayed for Islamic Culture
Zoo and Water Life Establishment in Al Ain
The National Rehabilitation Center
Abu Dhabi Farmers Services Centre
Organic Agriculture Center
Farmer Owner Financial Subsidies Fund
Family Development Foundation
Zayed Higher Organization
Social Care and Minors Affairs Foundation
Zayed bin Sultan Al Nahayan Charitable & Humanitarian Foundation
Khalifa Bin Zayed Al Nahayan Charity Foundation
Emirates Foundation
Private Housing Loans Authority
Khalifa University for Science, Technology and Researches
Emirates College for Educational Development
Paris-Sorbonne University–Abu Dhabi
Abu Dhabi Vocational Education and Training Institute
Institute of Applied Technology
Abu Dhabi Retirement Fund
Abu Dhabi Municipality
Al Ain Municipality
Western Region Municipality
The Center of Waste Management - Abu Dhabi
The Center for Regulation of Transport by Hire Cars (Trans Ad)
Compensations Fund for Owners of Taxi Licenses
International Fund for Habara Conservation
Mohamed bin Zayed Species Conservation Fund
Statistics Centre - Abu Dhabi
Presidential Flight Authority
Office of the Brand Abu Dhabi
Other Subject Entities

ABOUT ADAA 17
PART ONE
1.3 FUNCTIONS, PRIORITIES AND OUTCOMES
1.3.1 Functions
Law number 14 for 2008 defines ADAA’s responsibilities as:
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.
ADAA prioritizes its work and its high priority Subject Entities based on the following criteria shown in
the figure below:
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

Accountability Report 2012 18
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 - ADAA Training Center
GOALS
PRIORITIES
OUTPUTS
OUTCOMES
1.3.2 Priorities and Outcomes
ADAA’s outcomes are achieved through a mechanism that starts with its strategic goals whereby it
derives its work priorities hence, creating its output groups:

ABOUT ADAA 19
PART ONE
1.4 GOVERNANCE REPORT
ADAA aims at earning the trust of its stakeholders and sustaining it through adopting and implementing
the highest standards of accountability and transparency and issues its Governance Report accordingly.
In this report, ADAA follows a set of guiding principles, regulations, ideal fundamentals and processes
that are integrated under the following main components of governance:
Leadership
Institutionalization
Performance Management
Control
External Reports
1.4.1 Leadership
ADAA ensures that all its processes and operations adhere to the utmost principles of transparency
whereby its Chairman has welcomed and adopted various channels of communication with the
employees providing adequate communication relating to the overall strategy, ADAA’s yearly plan and
its performance through events such as the Annual Meeting held in the beginning of every year as well
as the monthly management meetings that cover different topics of importance and impact on ADAA’s
work and verifies that the workflow is in line with the annual plan and is consistent with the vision and
overall strategy of the Abu Dhabi Government.
1.4.2 Institutionalization
ADAA developed a strategic planning framework based on its’ strategic priorities. ADAA also developed
work methodologies for every output and service it provides in accordance with international best
practices and is considered a guideline for ADAA’s actions and the provision of its services. These
methodologies are constantly revisited and reviewed to ensure their validity and relevance to the current
needs of Abu Dhabi and relative stakeholders.
STRATEGIC
GOALS AND
OVERALL
STRATEGY
ADAA
MANDATE
PRIORITIES
OUTCOMES
OUTPUTS
Vision
Mission
Values

Accountability Report 2012 20 Accountability Report 2012 20
1.4.3 Performance Management
ADAA’s performance is measured based on a set of internationally recognized performance metrics
to ensure the objectivity of these measurements. ADAA has developed three types of performance
measures as shown below:
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
our services (outputs).
3- Internal Performance Indicators: to measure the performance of ADAA internal departments
and units.
ADAA implements a remuneration policy and procedure for its employees as well as a performance
management system that ensures fair evaluations of individual performance and identifies a clear career
path and progression plan for each one.
ADAA employees are exposed to training programs and workshops that aim primarily at enhancing their
capabilities, skills, knowledge and competence to grow within their careers.
ADAA considers communication a crucial and indispensable approach to measure its performance and
achieve transparency with its stakeholders; be it Subject Entities or the general public. ADAA launched
many initiatives to enhance awareness of its role and responsibilities that included launching its new
identity and its official website www.adaa.abudhabi.ae along with other initiatives to improve the
Accounting and Audit professions and has created communication channels with its Subject Entities to
encourage knowledge sharing such as the monthly e-newsletter “ADAA IFRS Digest”, the e-maarifa web
portal, Abu Dhabi Audit Management portal in addition to networking seminars, workshops and panel
discussions on new services and policies.
Internal
Performance
Indicators
Output
Performance
Indicators
Outcome
Performance
Indicators

ABOUT ADAA 21
PART ONE
Subject Entities Feedback
ADAA seeks feedback from its Subject Entities on the review process executed after the issuance of each
audit and assurance report. The feedback received constitutes an important guide to the effectiveness of
existing practices and further developments that may be required.
1.4.4 Control
Internal Control
ADAA annually reviews its internal controls, including financial, operational, compliance controls and
risk management to ensure that its processes are in line with best practice, laws, rules and regulations
through its internal audit function that follows international standards set forth in its “Internal Audit
Manual” issued in 2010 by ADAA.
ADAA also implemented a rigorous Code of Conduct safeguarding business and professional ethics and
ensuring that all ADAA employees understand and abide by this code of conduct, additionally ADAA’s
Compliance Officer is responsible for receiving and examining complaints related to employees and
processes and presenting recommendations for necessary action.
All ADAA employees take the below mentioned oath before the ADAA Chairman upon joining the
Authority as per Article (9) of Law (14) on the establishment of ADAA:
“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”
External Audit
ADAA’s financial statements are audited by an external auditor on an annual basis. For the year 2011,
Ernst and Young were reappointed in accordance with Statutory Auditor Appointment Rules issued by
ADAA for a fee of AED 89,000.

Accountability Report 2012 22
1.4.5 External Reports
ADAA prepares an annual plan that contains its operational intentions, objectives and performance
targets for the coming year. The plan also includes ADAA’s strategy, priorities, outputs, outcomes and
performance measures.
In addition, ADAA prepares an annual report to provide information about the following :
Comparison of actual outputs against set targets; as well as other information necessary to assess
ADAA’s performance during the financial year.
Governance Report.
ADAA’s annual financial statements accompanied with the Statutory Auditor’s report.

ABOUT ADAA 23

PART TWO
ADAA’s OUTPUTS

ADAA´s OUTPUTS 25
2.1 Financial Audit and Examination
2.2 Performance and Risk Assurance
2.3 Supporting Accountability
2.4 ADAA Training Center

Accountability Report 2012 26
PART TWO
INTRODUCTION
ADAA has established a number of outputs enabling the execution of its mandate as outlined in its
establishment law. The following table demonstrates ADAA’s outputs against the related part of the
mandate it fulfills:
ADAA’s OUTPUTS
MANDATE PERTAINING TO LAW
NO. (14) OF 2008
OUTPUT
GROUP OUTPUT
Audit the Government’s Consolidated Financial
Statements and Subject Entities’ Financial Statements. Financial Audit &
Examination
1. Financial Audit
2. Financial Examination
3. Financial Management
Assessment
4. Service & Output Review
5. Capital Project Review
6. Procurement Review
7. Internal Audit Assessment
8. Fraud Risk Review
9. Accountability Reports
10. Advisory
11. Special Examination
12. Qualifying Emirati Auditors
13. Research & Knowledge
Management
14. National & International
Representation
15. Seminars & Workshops
Performance
& Risk Assurance
Supporting
Accountability
ADAA Training
Center
Examine the efficiency, effectiveness and economy
of the financial and operational activities of Subject
Entities and ensuring their compliance with laws and
regulations and governance rules.
Train and qualify UAE National graduates of
universities and institutions and establish training
centers as necessary.
Submit an annual report on the activities of ADAA
and periodic reports to the Crown Prince as well as
carry out any other functions and duties requested
by the Crown Prince.
Provide advice and recommendations and perform
other procedures and services to Subject Entities as
ADAA Chairman deems reasonable and appropriate.
Investigate complaints referred to ADAA and
other violations it may discover as well as examine
violations investigated by Subject Entities.

ADAA´s OUTPUTS 27
PART TWO
2.1 FINANCIAL AUDIT AND EXAMINATION
ADAA developed 3 types of outputs under this group with the objective of providing assurance on the
accuracy of the Government’s Consolidated Financial Statements and the Financial Statements issued by
Subject Entities:
Financial Audit
Financial Examination
Financial Management Assessment
2.1.1 Financial Audit
Audit the Consolidated Financial Statements of the Government of Abu Dhabi to ensure accuracy of
these statements.
The “Financial Audit Methodology” was developed based on the International Standards on Auditing
(ISA) issued by the International Federation of Accountants (IFAC).
2.1.2 Financial Examination
Ensure that Subject Entities implement the Statutory Auditor Appointment Rules (SAAR) issued by
ADAA when appointing their statutory auditor and carry an examination of the Subject Entity’s financial
statements and the audit work undertaken by the statutory auditor to provide reassurance on the
accuracy of the financial statements of these Subject Entities.
The “Financial Examination Methodology” was developed based on the pronouncements and
methodologies of the International Federation of Accountants (IFAC).
Receive financial
statements and
perform
financial
analysis
Meet with SA
to discuss list of
queries
Prepare draft
letter of
comments and
incorporate SA
responses
Prepare list of
queries
Issue
Engagement
Letter
Review working
papers of SA
Plan the
assignment
E
X
E
C
U
T
I
O
N
R
E
PO
R
T
I
N
G
P
L
A
N
N
I
N
G
*SA (Statutory Auditor)
1
6
7
5
2
4
3
Issue final letter of
comments to SA
Issue ADAA Financial
Examination Report to
the Chairman of the
Subject Entity
8
9

Accountability Report 2012 28
2.1.3 Financial Management Assessment
Assess the financial management function at a Subject Entity and its conformity with best practices to
ensure efficiency of the preparation of its financial statements.
The “Financial Management Assessment” was developed based on good practice statements put by
the Chartered Institute of Public Finance and Accountancy (CIPFA). CIPFA is member of the International
Federation of Accountants (IFAC).
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
recommendations.
Prepare and issue
the report.

ADAA´s OUTPUTS 29
PART TWO
2.2 PERFORMANCE AND RISK ASSURANCE
ADAA developed 5 types of outputs under this group with the objective of ensuring Subject Entities’
resources and funds are managed, collected and expended efficiently, effectively and economically and
in compliance with the relevant laws and regulations and governance rules:
Service and Output Review
Capital Project Review
Procurement Review
Internal Audit Assessment
Fraud Risk Review
2.2.1 Service and Output Review
Review the services and outputs provided by Subject Entities to ensure efficiency, effectiveness and
economy of its operations and processes used to provide the service or output under review and its
conformity with best practices.
The “Service and Output Review Methodology” was developed based on leading practices in the industry.
2.2.2 Capital Project Review
Review infrastructure assets and critical projects under development by Subject Entities to ensure
efficiency, effectiveness and economy of the operational procedures of the project under review and its
conformity with best practices.
The “Capital Project Review Methodology” was developed based on Project Management standards
issued by the Project Management Institute (PMI).
2.2.3 Procurement Review
Review procurement at Subject Entities to verify the compliance with procurement regulations and
procedures at the Entity and to review the effectiveness, efficiency and economy of the procurement
function in line with best practices.
The “Procurement Review Methodology” was developed based on the pronouncements made by The
Chartered Institute of Purchasing and Supply (CIPS).

Accountability Report 2012 30
2.2.4 Internal Audit Assessment
Asses the Internal Audit function at Subject Entities to ensure efficiency, effectiveness and economy of
the Internal Audit activities and its conformity with best practices.
The “Internal Audit Assessment Methodology” was developed based on best practices and in accordance
with the standards issued by The Institute of Internal Auditors (IIA).
Internal
Audit
Assessment
Methodology
Organization &
Emiratization
Operation
Audit Committee
Technology
Value
2.2.5 Fraud Risk Review
Review the fraud risk framework at a Subject Entity to ensure the existence of an effective internal
framework that mitigates misuse of public funds, corruption and fraud risk.
The Assessment is conducted based on
measuring the Internal Audit function on
a series of 6 elements: Audit Committee,
Organization & Emiratization, Methodology,
Operation, Technology and Value

ADAA´s OUTPUTS 31
PART TWO
The “Fraud Risk Review Methodology” was developed based on leading practices in the industry covering
the following basic elements within any Subject Entity:
Integrated Policy
Internal & External Awareness
Fraud Scenario Assessment
Investigations
Internal & External Reporting
2.3 SUPPORTING ACCOUNTABILITY
ADAA developed 3 types of outputs under this group to support holding Subject Entities accountable for
their roles and responsibilities:
Accountability Reports
Advisory
Special Examination
2.3.1 Accountability Reports
ADAA reports periodically to His Highness the Crown Prince of Abu Dhabi and carries out other functions,
duties and responsibilities allotted to ADAA by His Highness.
2.3.2 Advisory
ADAA provides advice to Subject Entities upon receiving an official request from the Subject Entity and
obtaining the approval of ADAA Chairman.
ADAA provides its advice in accordance with its “Advisory Provision Methodology” and in light of the
information provided by the Subject Entity.

Accountability Report 2012 32
2.3.3 Special Examination
Examine complaints referred to ADAA or discovered when carrying out its work at a Subject Entity to
identify all aspects of the complaint, its nature and the individuals responsible and hold them accountable.
In addition, ADAA examines violations investigated by Subject Entities.
The “Special Examination Methodology” was developed based on best practices and in accordance with
applicable laws and regulations in the Emirate of Abu Dhabi.
Complaint
Received & Registered
Present to ADAA
Chairman
Open
Investigation
Collect Evidence &
Investigate Violators
Prepare Report with
Results
Present to ADAA
Chairman
Issue Final
Report
Disciplinary Action
Against Violators
Refer to Public
Prosecutor
Open
Examination
Inquire & Collect
Data
Conclude
Result
Present to ADAA
Chairman
Refer to
Subject Entity
File &
Close
File for
investigation
Suspected
crime

ADAA´s OUTPUTS 33
PART TWO
2.4 ADAA TRAINING CENTER
ADAA developed 4 types of outputs under this group with the objective of training and developing UAE
Nationals and supporting sharing knowledge and leading practices:
Qualifying Emirati Auditors
Research and Knowledge Sharing
National and International Representation
Seminars and Workshops
2.4.1 Qualifying Emirati Auditors
Develop specialized training programs with the objective of contributing to the training and development
of Emirati Auditors and assisting them acquire the necessary skills and knowledge to advance and excel
in their careers. Professional training programs were developed specifically for Emiratis 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.
2.4.2 Research and Knowledge Sharing
ADAA set-up this output with the objective of creating awareness of best practices implemented in the
public sector and on an international level as well as developing a local knowledge-base and resources
hub that contributes to the development of government performance.
ADAA launched many research and knowledge sharing initiatives such as:
Research and Knowledge Management (RKM) Function: ADAA established this function in
2009 with the objective of developing, codifying and disseminating 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.
Accounting and Auditing Standards Desk (AASD): ADAA established the AASD to supervise
issuing technical papers in accounting and auditing and issues a monthly e-newsletter about the
International Financial Reporting Standards (IFRS) titled “ADAA IFRS Digest”, a quarterly bulletin on
the International Public Sector Accounting Standards (IPSAS) and Illustrative IFRS and IPSAS entity
and consolidated and whole of Government Financial Statements. AASD publications focus primarily
on accounting matters related to preparation of Subject Entities” financial statements, and assist in
eliminating inconsistencies in the interpretations of current accounting standards.

Accountability Report 2012 34
E-maarifa: In 2010, e-maarifa web 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.
Practice Guides: ADAA identifies best practices that are internationally recognized and implemented
and issues practice guides for use throughout the public sector.
2.4.3 National and International Representation
Participate actively in the regulation and supervision of the accounting and audit profession through
acquiring memberships of various national and international organizations that promote and support
accountability and transparency and contributing to the enhancement of laws and regulations in this
area.
“ADAA IFRS Digest” highlights hot topics
in the accounting profession whereby
ADAA presents technical papers and
interpretations of standards.
ADAA was the 1st organization in the
Middle East to become a member of the
International Forum of Independent Audit
Regulators (IFIAR) and to be elected to sit
on its Advisory Council.

ADAA´s OUTPUTS 35
PART TWO
2.4.4 Seminars and Workshops
Organize seminars and workshops for Subject Entities on matters that complement ADAA’s primary role
and fall within its area of expertise.
Abu Dhabi Technical Forum (ADTF): This Forum brings together the UAE based accounting
and audit technical professionals of the international audit 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 the heads of the Internal Audit functions
at Subject Entities to discuss processes, internal controls, policies, issues and challenges as well as
share knowledge of best practices and developments.

PART THREE
2011 REPORT
AND 2012
WORK PLAN

2010 REPORT AND 2011 WORK PLAN 37
3.1 2011 Acheivements Highlight
3.2 Financial Audit and Examination Outputs
3.3 Performance and Risk Assurance Outputs
3.4 Supporting Accountability Outputs
3.5 ADAA Training Center Outputs
3.6 2012 Work Plan

Accountability Report 2012 38
2011 REPORT AND 2012 WORK PLAN
PART THREE
3.1 2011 ACHEIVEMENTS HIGHLIGHT
Issued 87 Financial Audit and Examination reports:
• 9 Financial Audit
• 73 Financial Examination
• 5 Financial Management Assessment
Issued 68 Performance and Risk Assurance reports:
• 3 Service and Output Review
• 1 Capital Project Review
• 10 Procurement Review
• 54 Internal Audit Assessment
Issued 57 Supporting Accountability reports
ADAA was elected by members of the International Forum of Independent Audit Regulators (IFIAR)
to sit on its Advisory Council making the UAE the first Arab country to become a member.
ADAA announced the commencement of the US Certified Public Accountant (CPA) Examinations in
Abu Dhabi and the region after long negotiations with the National Association of State Boards of
Accountancy “NASBA”.
ADAA enhanced the value of the e-maarifa portal by bringing on board contributions from the likes
of the Institute of Internal Auditors, and international audit firms; accordingly, the membership stood
at over 900 Internal Auditors working within 117 Subject Entities.
ADAA sustained its support to a number of Subject Entities in establishing their internal audit
functions.
ADAA held the third annual Internal Audit Seminar for its Subject Entities with an attendance record
exceeding the two previous years.
ADAA chaired the Abu Dhabi Technical Forum (ADTF) unifying accounting interpretations between
ADAA, audit firms and accounting and auditing professionals in the UAE.
ADAA issued 69 technical papers covering subjects such as: Transactions with Government, Related
Parties, Leasing, Impairment, Fair value, Presentation and Disclosure.
ADAA sustained its advice and support to the Governance Committee to assist in producing various
deliverables supporting the Committee focus areas.
ADAA completed over 100 research assignments including several global benchmarking studies,
an Internal Audit Survey across 42 Subject Entities, research papers on Change Management, Food
Safety, Food Security and Government Wide Agreements in Procurement as well as issuing the Global
Accountability & Transparency Newsletter.
ADAA received the “Outstanding Contribution” award at the 1st Middle East Accountancy and
Finance Excellence Award.

2011 REPORT AND 2012 WORK PLAN 39
PART THREE
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.
Description Actual
2009
Actual
2010
Target
2011
Actual
2011
Financial Audit and
Examination Group 78 96 85 87
Performance and Risk
Assurance Group 69 83 83 68
Supporting Accountability
Group 20 34 30 57
Total Number of Reports 167 213 198 212

Accountability Report 2012 40
3.2 FINANCIAL AUDIT AND EXAMINATION OUTPUTS
This output group focused on the audit of the consolidated financial statement of the Government of
Abu Dhabi, and examination of the financial statements of Subject Entities.
This group continues to advise Subject Entities how to improve the quality of their financial reporting and
specifically in relation to their financial statements basis of preparation varying according to the Subject
Entity’s operations, with a focus on having all Subject Entities prepare their financial statements using
IPSAS Accrual basis of accounting or IFRS based on the nature of their activities:
Government Entities (Excluding SOE’s) Financial Statements Basis of Preparation:
State Owned Enterprises (SOEs) Financial Statements Basis of Preparation:
30
25
20
15
10
5
0
26
20
13 14
6
25
7 7
9
6 6
1
21
19 18
IFRS IPSAS – Accrual basis IPSAS – Cash basis Other basis of
preparation Non-attested
financial statements
2009 2010 2011
18 19
3
19
2
3
20
15
10
5
0
2009 2010 2011
IFRS Other basis of preparation

2011 REPORT AND 2012 WORK PLAN 41
PART THREE
The group’s reports and recommendations are the result of one of the following types of outputs:
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 2010 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 2011, ADAA examined 73 independent audit reports and work of statutory auditors, appointed
by Subject Entities. The financial statements and audits covered in 2011 were selected in accordance with
the prioritization criteria developed by ADAA.
ADAA’s Financial Examination Comments Summary
Comments arising from ADAA’s financial statements examinations 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:
Minor improvements have been noticed in the financial statements issuance timeliness. Nevertheless,
this is still considered as a significant area of concern, since delays reduce 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.
Inadequate selection of the basis of preparation of financial statements, whereby certain government
entities are still using IFRS as the basis of preparation rather than IPSAS.
Incorrect treatment and presentation of government grants/funding.
Valuations based on invalid or untested assumptions for impairment reviews and assets.

Accountability Report 2012 42
Deficiencies in the audit procedures performed when auditing accounting estimates.
Insufficient procedures performed by statutory auditors to test and rely on the internal controls.
Weaknesses in the quality of audit evidence statutory auditors rely on.
Management’s reliance on statutory auditors for financial reporting and accounting matters.
Insufficiencies in procedures performed by statutory auditors over information systems.
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.
Inadequate 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 the examination reports sent to Subject Entities for
implementation and improvement in the future.
These reports include the responses and explanations provided by the statutory auditors and ADAA’s final
conclusions and views on each examination comment.
Analysis of Examination Comments
ADAA’s comments are classified into “Significant improvement required”, “Needs improvement” and
“Needs improvement- Specific exception noted” based on their nature and significance to the financial
statements of Subject Entities and the Statutory Auditor’s audit procedures.
Below is a comparison of the financial examination reports, conducted in 2011 and 2010*:
Needs improvement Needs improvement -
Specific exception noted Significant improvement
required
2011
(73 reports) 2010
(82 reports)
194 142
309 362
179
208

2011 REPORT AND 2012 WORK PLAN 43
PART THREE
ADAA’s financial examination reports included 682 comments in 2011 classified as follows:
Significant improvement required
194 comments in 2011 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 309 comments in this category focus on audit quality resulting from incomplete
documentation of audit procedures performed, such as review of subsequent events. 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
179 comments in 2011 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 nature and extent of audit
procedures preforemed 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 IFRS or IPSAS, financial statements presentation and disclosures,
and insufficient audit procedures in areas affecting various captions of the financial statements such
as inventories, related parties, estimates, communication with those charged with governance and fair
values.
Below is an analysis of independent audit reports examined by ADAA, comments raised and their
respective classification:
Year 2011 Year 2010
Statutory
Auditor
Number
of reports
examined
Significant
improvement
required
Needs
improvement
Needs
improvement
Specific
exceptions
noted
Total
Comments
Number
of reports
examined
Total
Comments
Firm 1 20 61 99 62 222 17 157
Firm 2 19 48 87 44 179 11 89
Firm 3 19 59 75 36 170 47 423
Firm 4 15 26 48 37 111 7 43
Grand
Total 73 194 309 179 682 82 712

Accountability Report 2012 44
Implementation of SAAR
During 2011, ADAA continued monitoring the Subject Entities implementation of the Statutory Auditors
Appointment Rules (SAAR), established according to resolution number (1) of 2010 issued by the
Chairman of ADAA.
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 2011, ADAA conducted “Financial Management Assessments (FMAs)” on 5 different Subject Entities
reviewing their financial capabilities, processes and assisting them in enhancing and strengthening their
finance functions and financial management processes.
Upon conducting the 5 FMAs, ADAA found that financial management at 3 Subject Entities are at
an “Emerging” stage while 2 Subject Entities were at a “Maturing” stage based on the assessment
methodology followed by ADAA.
Below is a comparison of the results of the financial management assessments conducted in 2011 and
2010:
3
2
3
2
4
3
2
1
0
2011 2010
Emerging Maturing

2011 REPORT AND 2012 WORK PLAN 45
PART THREE
3.3 PERFORMANCE AND RISK ASSURANCE OUTPUTS
This output group provides assurance on the efficient, effective and economic utilization of resources by
Subject Entities and its compliance with laws and regulations and governance guidelines.
In 2011, ADAA issued 68 Performance and Risk Assurance reports relating to government-wide issues,
functional areas and single subjects of significance for Subject Entities.
The following chart demonstrates the development of governance structures (Audit Committees/ Internal
Audit functions) within Subject Entities:
The group’s reports and recommendations are the result of one of the following outputs:
Service and Output Review
Capital Project Review
Procurement Review
Internal Audit Assessment
Fraud Risk Review
3.3.1 Services and Output Review
The Service and Output Review deliverables during 2011 were related to various sectors and covered
reviews of activities, operations, business regulations, policies and procedures and best practices
implemented upon the provision of their services and outputs.
50
45
40
35
30
25
20
15
10
5
0
6
17 16
23
35 37
46 46
50
46
Prior to Year 2008 Year 2008 Year 2009 Year 2010 Year 2011
Audit Committee Internal Audit Function

Accountability Report 2012 46
Below are summaries of key Service and Output Reviews that were conducted in 2011 with a brief
description of the scope of the review and recommendations by ADAA:
Industrial Licensing Review
This Review covered Industrial licensing activities as undertaken by the Higher Corporation for Specialized
Economic Zones (ZonesCorp) for the period running from January 2010 up to March 2011.
The objectives of the review were to verify:
The existence of approved regulations for industrial licensing.
The alignment of these regulations with leading practices.
The effectiveness of operational management in the implementation and application of regulations,
and to assess the quality and efficiency of the outputs.
The degree of compliance with regulations and to report on instances of non-compliance.
Recommendations
ADAA recommendations included:
Conduct a strategic review of all regulations affecting licensing of industrial enterprises within
Abu Dhabi, focusing on assuring the value of the set of regulations to Abu Dhabi and its
contribution to achieving the Policy Agenda goals as well as reducing potential duplication of
regulation conducted by different Government Entities.
Assume Industrial Licensing activities by an independent entity to eliminate conflict of interest
in ZonesCorp.
Encourage certain industries and small-medium enterprises (SME’s) by employing a risk
based or another triaging approach when establishing licensing requirements and that will
encourage economic diversification and protect the public.
Review, update and approve the Job Descriptions for Regulatory Affairs & Compliance
resources, specifically inspection staff. Also, ensure that the staff engaged has the acceptable
qualifications/experience for the role.
Develop KPIs to gauge ZonesCorp’s performance in Industrial Licensing and cascade these
measures to the performance evaluations of Regulatory Affairs & Compliance resources.
Include timeframes in the inspection reports for rectifying violations committed by investors
and ensuring that violations are addressed through follow-up visits.
Consider the migration of Industrial Inspection reports to an electronic system that would
allow the Inspectors to submit the inspection from the field, using tools such as PDA’s.

2011 REPORT AND 2012 WORK PLAN 47
PART THREE
Environmental Licensing Review
This Review was conducted to provide an objective evaluation of the environmental licensing regime
implemented by the Environment Agency-Abu Dhabi (EAD) to produce its mandated output in a
controlled and sustainable environment.
The objectives of the review were to:
Verify the existence of approved regulations for environmental licensing and inspection.
Assess the alignment of approved regulations with leading practices.
Evaluate the effectiveness of operational management in the implementation and application of
regulations and to assess the quality and efficiency of the outputs.
Assess the degree of compliance with regulations and to report on instances of non-compliance.
Recommendations
ADAA recommendations included:
Develop a stakeholder engagement framework to design and formalize the relationship
between EAD and its key stakeholders.
Develop a strategic plan for licensing and inspection activities, in order to establish realistic
goals, objectives and KPI’s consistent with and linked to EAD’s overall strategy.
Revisit current established committees in terms of relevance, importance and necessity;
subsequently, enact the ones required to support specific activities.
Ensure licensing all EAD related activities in line with its mandate and any exceptions to be
escalated for validation through the proper channels prior to implementation.
Ensure the availability of a sufficient workforce; to conduct a comprehensive comparative
analysis between the number of licensees for each category, the inspection scope, and the
available teams of inspectors as well as identifying gaps in quantity and credentials to attain a
realistic figure for the number of inspectors needed to perform the inspection process.
Enforce an effective fining system to support the inspection process; fines imposed may be
financial and operational, including large amounts and/or potential interruption of all activities
until deficiencies are addressed.

Accountability Report 2012 48
➢ Parking Management Program (Mawaqif) Review
This Review was conducted to look at Mawaqif’s strategy and operations.
The objectives of the review were to verify:
The parking strategy and its link with the overall public transport plans for Abu Dhabi.
Mawaqif’s outputs in relation to its legal mandate and its performance in managing public parking
within Abu Dhabi.
Mawaqif’s performance in providing customer service.
Compliance of Mawaqif’s operations with established policies and procedures.
3.3.2 Capital Project Review
The Capital Project Review deliverables during 2011 were related to the evaluation of the development
program and operations of critical projects.
Below is a summary of a Capital Project Review that was conducted in 2011 with a brief description of
the scope of the review and recommendations by ADAA:
Khalifa Port
This review evaluated whether the program of works necessary to develop the new Khalifa Port and the
associated Industrial Zone is sufficient to ensure the effective, efficient and economic delivery of a world-
class operational facility.
Recommendations
ADAA recommendations included:
Pursue separation between Mawaqif and Department of Transport (DoT).
Ensure structured decision-making and performance management.
Develop comprehensive strategy.
Implement appropriate pricing for parking.
Enhance financial planning and management and improve operational oversight.

2011 REPORT AND 2012 WORK PLAN 49
PART THREE
The Program was evaluated in the following areas:
Current progress of the Program in delivering against schedule and budget.
The Program funding approach and status.
The performance of Program Management practices in place.
Compliance of procurement efforts related to the Program with accepted procurement practices.
3.3.3 Procurement Review
The Procurement Review deliverables during 2011 were related to capital and operational expenditure
procurement compliance. ADAA issued 10 Procurement Review reports.
The scope of the reviews was in relation to the following:
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 a road map for necessary improvements.
These reviews led to discovery of violations that were further investigated and resulted in disciplinary
action against responsible individuals.
Recommendations
ADAA recommendations included:
Revise the funding strategy to mitigate risk in case the Government chooses a different
reimbursement model.
Engage experienced professionals in control functions such as Quality Management and Risk
Management.
Establish an independent Quality Control Function.
Consider establishing a Project Management Process that covers the full project life-cycle and
is governed by an appropriate Investment Committee before undertaking new phases.
Revisit the Governance structure and conduct a strategic review of the Projects Unit at the
close of phase 1 of the Program (at the end of 2012).

Accountability Report 2012 50
3.3.4 Internal Audit Assessment
During 2011, ADAA issued 54 Internal Audit Assessment reports with the purpose of identifying gaps in
performance, in addition to areas for improvement to bring the internal audit role at Subject Entities to
meet benchmark practices.
Another key objective from these assessments was to obtain assurance on the efficiency, effectiveness
and economy of Internal Audit activities and highlighting areas of risk exposure at the Subject Entities.
Internal Audit functions were assessed on a series of 6 elements: Audit Committee, Methodology,
Organization & Emiratization, Operation, Technology and Value.
Internal Audit Assessment Reports Summary
ADAA issued 1,780 recommendations to provide Subject Entities with insight on the control environment
and for the enhancement of the governance structure.
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 element:
Out of 54 Subject Entities, 37 met pass requirements based on the criteria established by ADAA, while
17 did not. The following chart shows the result of the internal audit assessments conducted in 2011
compared to 2010.
282
553
127
332
401
85
Value
Technology
Operation
Methodology
Audit Committee
Organization & Emiratization
0 100 200 300 400 500 600
No Pass
Pass
2010
(63 assessments) 2011
(54 assessments)
37
17
32 31

2011 REPORT AND 2012 WORK PLAN 51
PART THREE
3.3.5 Fraud Risk Review
ADAA established this output in 2008 to assist its Subject Entities in creating a proactive response to
potential vulnerabilities related to fraud, corruption and misconduct “Fraud”.
The Review is designed to ensure that Subject Entities have an effective internal framework to prevent,
detect and respond effectively to matters related to Fraud.
In 2011, ADAA supported 3 Subject Entities with the development of their Code of Conduct and Fraud
Control Policy by assisting them with the roll-out and implementation of these components.
ADAA provided supervision and technical assistance to the 3 Subject Entities who conducted Fraud
Scenario Assessments and the recommendations included:
Ensure all contracts contain a Fraud-related clause to protect the Subject Entity in relation to Fraud
that is perpetrated within or against a contract that impacts assets.
Review current insurance policies and assess the cost/benefit of insuring against losses arising from
Fraud.
Develop comprehensive policies and procedures for procurement and project management activities.
Set a declaration mandate whereby employees disclose any direct personal interests by them and/or
consultants on every project they are assigned to.
Set limitations on accessing the system that allows addition of vendors or a change in vendor details;
specifically to employees that are engaged in the payment or purchasing processes.
3.4 SUPPORTING ACCOUNTABILITY OUTPUTS
This output group provides the necessary support to hold Subject Entities accountable for their roles and
responsibilities and fulfilling them.
In 2011, ADAA issued 57 reports under this output that included:
Accountability Reports
Advisory
Special Examination
3.4.1 Accountability Reports
A number of reports were issued under this output on matters arising from annual work and audits
carried by ADAA.
Among the reports submitted to His Highness the Crown Prince under this output, is the Audit Report on
the Consolidated Financial Statements of the Government of Abu Dhabi and this annual Accountability
Report that ADAA completes in the first quarter of each year.

Accountability Report 2012 52
3.4.2 Advisory
ADAA provides advice upon receiving requests from Subject Entities. Below is an example of such
advisory work provided during 2011:
Accounting Technical Advice
In 2011, ADAA issued 69 technical papers covering 37 different accounting topics. ADAA issues
accounting technical position papers that provide specific guidance to Subject Entities on particular
topics. These papers contribute to the improvement of 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.
Internal Audit Function Establishment Support
ADAA provided guidance, tools, methodology and advice to support a smooth and effective establishment
of the Internal Audit role at a number of Subject Entities.
In 2011, ADAA completed 4 installations of the e-Governance Portal along with the necessary training
required and setting the methodology.
Governance Program
The Abu Dhabi Governance Committee was established through the Executive Council Resolution No. 17
of 2010 to supervise the development and implementation of the frameworks of governance principles
presented to the Executive Council by ADAA during 2010.
During 2011, ADAA supported the Governance Committee by assisting the overall program and
producing the 21 deliverables of the Committee in the areas of Public Finance & Performance, Civil Service,
Procurement and SOE Governance. All deliverables were submitted to the responsible Government Entity
for review and implementation.
3.4.3 Special Examination
In 2011, ADAA received 34 complaints that were examined as per the “Special Examination Methodology”
outlined by ADAA.

2011 REPORT AND 2012 WORK PLAN 53
PART THREE
No. Action Taken 2009 2010 2011
1. Conducted investigations 3 5 6
2. Conducted examinations 8 9 16
3. Closed the complaint due to inaccuracy or
insignificance of complaint or no-violation 1 16 8
4. Transferred to responsible entity - out of ADAA scope 0 2 2
5. Presented technical advice to law enforcement
authority 0 1 2
Total number of Complaints received by ADAA 12 33 34
Based upon the investigations conducted by ADAA in 2011, some cases were referred to the relevant
public prosecutor office to take the necessary action when the investigation of the violation indicated the
existence of a suspected punitive crime.
All examinations conducted by ADAA in 2011 were generally identified as violations related to the
following:
Abuse of power and conflict of interest.
Violation of procurement laws, regulations and procedures.
Negligence in managing public money.
Breaching code of conduct.
Below is a summary of some of ADAA examinations and investigations cases in 2011:
These examinations resulted in a variety of actions taken and are shown in the following table:
CASE 1
ADAA received a complaint of a financial violation being committed at a Subject Entity relating
to awarding two tenders illegitimately to vendors through direct orders, worth approximately
AED 6.68 million, as well as establishing a foreign branch of the Subject Entity on its own
expense with ownership moved to employees at the Subject Entity. The complaint included bribe
claims against some employees at the Subject Entity to illegally increase the classification and
quality of the imported products.
Upon examining the violations, ADAA validated the allegations filed and informed the Subject
Entity in order to take disciplinary action against the violators and other involved parties as well
as notifying the Public Prosecution of the incident since it was suspected as a punitive crime.

Accountability Report 2012 54
CASE 2
ADAA received a complaint from a law enforcement authority committed by an Executive
Director at a Subject Entity stating that he had awarded tenders illegitimately to a vendor owned
by a member of his direct family (son) worth AED 154,250 and technically qualifying this vendor
for tenders worth more than AED 900,000 in addition to the inconsistency of the vendor’s
licensed activity with the requirements of the tender awarded.
Upon examining the violations, ADAA validated the allegations against the Executive Director
and other involved parties and informed the Subject Entity in order to take disciplinary action
against the violators as well as notifying the Public Prosecution of the incident since it was
suspected as a punitive crime.
CASE 3
ADAA received a complaint claiming that the technical and commercial evaluation of a tender
worth AED 2.5 billion requested by a public service entity was tampered with in order to
disqualify a certain contractor from bidding for the project.
Upon examining the violation, ADAA confirmed the allegations brought forward against
employees at the Subject Entity along with the project consultants and confirmed conflict
of interests between the parties involved. Hence, ADAA informed the Subject Entity in order
to take disciplinary action against the violators as well as reviewing and revisiting the project
management processes and policies for such projects.
CASE 4
ADAA received a complaint claiming that violations are committed in the operational execution
of a construction project worth more than AED one billion.
Upon examining the violation, ADAA confirmed the allegations brought forward against the
awarded joint ventures (JV) of contractors that had signed a forged JV agreement against the
exchange of illegitimate commissions. ADAA also found that a number of executives at the
Subject Entity were involved in awarding the tender to the JV resulting in delays in the progress
of work and suspending it until the completion of the examination.
ADAA informed the Subject Entity in order to take disciplinary action against the violators and
resolving the conflict between the contractors involved.

2011 REPORT AND 2012 WORK PLAN 55
PART THREE
3.5 ADAA TRAINING CENTER OUTPUTS
ADAA created an integrated approach to establishing this output group to fulfill its objective of training
and developing UAE Nationals and supporting sharing knowledge and leading practices.
The outputs defined under this group are:
Qualifying Emirati Auditors.
Research and Knowledge Sharing.
National and International Representation
Seminars and Workshops.
3.5.1 Qualifying Emirati Auditors
ADAA has developed training programs addressing its objective of increasing the number of qualified
Emirati Auditors in the Government and these programs include on-the-job training, secondments
to the audit firms as well as simultaneously 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.
ADAA alongside The National Association of State Boards of Accountancy announced in March 2011 the
commencement of the USA CPA examination in the UAE after extensive efforts and negotiations that
took place over a span of two years making it accessible to everyone in the UAE and the region.
3.5.2 Research and Knowledge Sharing
ADAA set-up this output with the objective of creating awareness of best practices implemented in the
government public sector and on an international level as well as developing a local knowledge-base and
resources hub that contributes to the development of government performance.
Many initiatives were launched under this output such as:
➢ The Research and Knowledge Management (RKM) Function
During 2011, the Research and Knowledge Management (RKM) function at ADAA completed over 100
research assignments, an Internal Audit Survey across 42 Abu Dhabi Government entities and issued 4
Research Papers.

Accountability Report 2012 56
Accounting and Auditing Standards Desk (AASD)
In 2011, ADAA issued 11 “ADAA IFRS Digest” newsletters and issued IPSAS bulletins on quarterly basis.
Both publications include ADAA’s hot topics, what’s new from either the IASB or the IPSASB and the
accounting profession.
In addition, ADAA prepared illustrative financial statements for IFRS and IPSAS reporters for the year end
31 December 2010.
E-maarifa
The e-maarifa portal (https://www.e-maarifa.ae) launched in 2010 with the Abu Dhabi Audit Management
(ADAM) site brought together members of the Internal Audit community across Abu Dhabi Government
to share information and communicate on key issues.
In 2011, the membership of ADAM site under the e-maarifa portal increased to 409 members from
around 78 Subject Entities while the e-maarifa total membership stood at over 900 members from 117
Subject Entities.
3.5.3 National and International Representation
ADAA continued to put in efforts to explore new opportunities that contribute to enhancing accountability
and transparency across the Government and the implementation of best practices.
After becoming the first Middle Eastern organization to acquire membership in the International Forum
of Independent Audit Regulators (IFIAR) in early 2009 and to host the IFIAR Plenary Meeting in Abu Dhabi,
ADAA was elected by IFIAR members to sit on the IFIAR Advisory Council as the first Arab organization
along with members from Germany, Japan, Canada, Netherlands and Spain. ADAA participated in both
IFIAR plenary meetings in Berlin and Bangkok respectively whereby ADAA took initiative to host the 2012
IFIAR Inspection Workshop.
Further collaborations took place in 2011 between ADAA and other national and international
organizations, such as ADAA’s presentation of a lecture on “Governance in the Public Sector” at the
Dubai Financial Audit Department (FAD), hosting a delegation from FAD to share knowledge and best
practices in Audit and Accounting. ADAA also sponsored the “Conference on Accounting and Auditing
Profession & Envision of Future Horizons” organized by the UAE Accountants and Auditors Association
(AAA).
It’s worth mentioning ADAA’s recognition by The Institute of Chartered Accountants in England and
Wales (ICAEW), whereby ADAA received the “Outstanding Contribution by and Organization” Award at
the 1st Middle East Accountancy and Finance Excellence Awards.
3.5.4 Seminars and Workshops
ADAA conducted workshops and seminars for Subject Entities and the public on matters that complement
its primary role and fall within its area of expertise.

2011 REPORT AND 2012 WORK PLAN 57
PART THREE
Below is a summary of ADAA’s activities in 2011 related to this output:
Abu Dhabi Technical Forum (ADTF)
ADAA continued holding these forums throughout 2011 chaired by its Head of Accounting and Auditing
Standards Desk (AASD) and resulted in conducting reviews of 44 accounting technical papers.
Internal Audit Seminar
ADAA held its 3rd Internal Audit Seminar in February 2011 for more than 70 Heads of Internal Audit at
Subject Entities discussing challenges in the profession, internal controls, internal audit processes and
policies.
3.6 2012 WORK PLAN
Below are the highlights of ADAA’s 2012 work plan:
Issue the audit report on the consolidated financial statements of the Government within the time-
frame specified in the Financial Management Law.
Conduct examinations of the financial statements of 70 Subject Entities and enhance and unify
Subject Entities’ financial statements basis of preparation according to Subject Entities’ operations
and aligned with international standards.
Assess the Internal Audit function at 50 Subject Entities and continue to provide support to improve
the role of internal audit.
Conduct 20 Procurement Review.
Conduct 10 Output and Service Review and Capital Project Review.
Examine and investigate complaints referred to ADAA or discovered during it’s course of work at
Subject Entities.
Address complex accounting matters and unify interpretations of financial reporting standards
through the Abu Dhabi Technical Forum.
Monitor Subject Entities’ compliance with the Statutory Auditor Appointment Rules (SAAR).
Strengthen the financial management function within Subject Entities and conduct 5 Financial
Management Assessments.
Host the IFIAR Inspection Workshop.
Support the Research and Knowledge Management function at ADAA and continue cooperation
with international peers for knowledge sharing and adoption of best practices.
Issue the Fraud Scenario Assessment (FSA) Methodology.
Continue to provide advice to Subject Entities.

PART FOUR
2011 AUDITED
FINANCIAL
STATEMENTS

2011 AUDITED FINANCIAL STATEMENTS 59
ADAA 2011 Audited Financial Statements

Accountability Report 2012 60
PART FOUR
2011 AUDITED FINANCIAL STATEMENTS
FINANCIAL STATEMENTS TOGETHER
WITH AUDITORS’ REPORT
31 DECEMBER 2011
PART FOUR

61
PART FOUR
2011 AUDITED FINANCIAL STATEMENTS
INDEPENDENT AUDITORS’ REPORT TO THE CHAIRMAN OF
ABU DHABI ACCOUNTABILITY AUTHORITY
We have audited the accompanying financial statements of the Abu Dhabi Accountability Authority
(“the Authority”), which comprise the statement of financial position as at 31 December 2011 and the
statement of financial performance, statement of changes in Government of Abu Dhabi account, cash
flows statement and statement of comparison of budget and actual amounts for the year then ended,
and a summary of significant accounting policies and other explanatory notes.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with International Public Sector Accounting Standards, and for such internal control as
management determines is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing. Those standards require
that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance
whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditors’ judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of accounting estimates made by management, as well as evaluating the
overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Opinion
In our opinion, the financial statements present fairly, in all material respects, the financial position of
the Authority as of 31 December 2011 and its financial performance and its cash flows for the year then
ended in accordance with International Public Sector Accounting Standards.
Signed by
Andre Kasparian
Partner
Ernst & Young
Registration No. 365
30 January 2012
Abu Dhabi

Accountability Report 2012 62
TABLE OF CONTENTS
1 Statement of financial position
2 Statement of financial performance
3 Statement of changes in Government of Abu Dhabi account
4 Cash flows statement
5 Statement of comparison of budget and actual amounts
6 Notes to the financial statements
Page
1
2
3
4
5
6-16

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Page 1 of 16
2011 AUDITED FINANCIAL STATEMENTS
The financial statements were authorised for issue in accordance with a resolution of the Authority’s
Chairman on 30 January 2012.
Mohammad Saif Al Muheiri Riyad Abdulrahman Al Mubarak
Director of Finance Chairman
Abu Dhabi Accountability Authority
STATEMENT OF FINANCIAL POSITION
As at 31 December 2011
Notes
2011
AED
2010
AED
ASSETS
Current assets
Bank balances and cash 4 30,190,808 25,058,433
Debtors and other debit balances 5 6,311,142 7,952,158
36,501,950 33,010,591
Non-current assets
Property and equipment, net 6 2,594,422 4,716,435
Intangible assets, net 7 596,672 1,315,047
Advance to suppliers 626,525 -
3,817,619 6,031,482
TOTAL ASSETS 40,319,569 39,042,073
LIABILITIES
Current liabilities
Payables and other credit balances 8 2,768,310 3,797,752
Government of Abu Dhabi account 21,387,621 21,838,688
24,155,931 25,636,440
Non-current liabilities
Government of Abu Dhabi account 1,093,458 1,873,364
Employees’ end of service benefits 9 15,070,180 11,532,269
16,163,638 13,405,633
TOTAL LIABILITIES 40,319,569 39,042,073
The attached notes 1 to 16 form part of these financial statements.

Accountability Report 2012 64
Page 2 of 16
Notes
2011
AED
2010
AED
Revenues
Contribution from Government of Abu Dhabi 11 109,616,477 109,180,583
Other income 1,011,852 1,107,089
Total revenues 110,628,329 110,287,672
Expenditures
Salaries, wages and other benefits 94,016,751 92,492,625
Employees’ end of service benefits 9 4,672,268 2,588,251
Depreciation and amortization 4,158,118 4,175,396
General and administrative expenses 10 7,781,192 11,031,400
Total expenditures 110,628,329 110,287,672
Abu Dhabi Accountability Authority
STATEMENT OF FINANCIAL PERFORMANCE
For the year ended 31 December 2011
The attached notes 1 to 16 form part of these financial statements.

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Page 3 of 16
Abu Dhabi Accountability Authority
STATEMENT OF CHANGES IN GOVERNMENT OF ABU DHABI ACCOUNT
For the year ended 31 December 2011
Classified in the statement of financial position as:
2011
AED
2010
AED
Balance at 1 January 23,712,052 32,892,635
Funds received during the year 108,385,504 100,000,000
Contribution recognized as revenue during the year (109,616,477) (109,180,583)
Balance at 31 December 22,481,079 23,712,052
2011
AED
2010
AED
Non-current liabilities 1,093,458 1,873,364
Current liabilities 21,387,621 21,838,688
Balance at 31 December 22,481,079 23,712,052
The attached notes 1 to 16 form part of these financial statements.

Accountability Report 2012 66
Page 4 of 16
Abu Dhabi Accountability Authority
CASH FLOWS STATEMENT
For the year ended 31 December 2011
Notes
2011
AED
2010
AED
CASH FLOWS FROM OPERATING ACTIVITIES
Adjustments for non-cash items:
Depreciation and amortization 4,158,118 4,175,396
Provision for employees’ end of service benefits 9 4,672,268 2,588,251
Gain on sale of property and equipment (96,027) (38,000)
Decrease (increase) in debtors and other debit
balances 1,641,016 (94,012)
Decrease in payables and other credit balances (1,029,442) (11,731,605)
Decrease in Government of Abu Dhabi account (1,230,973) (9,180,583)
Employees’ end of service benefits paid 9 (1,134,357) (2,954,495)
Net cash flows from (used in) operating activities 6,980,603 (17,235,048)
CASH FLOWS USED IN INVESTING ACTIVITIES
Purchase of property and equipment 6 (571,905) (1,511,192)
Purchase of intangible assets 7 (745,825) (86,753)
Advance to suppliers (626,525) -
Proceeds from sale of property and equipment 96,027 38,000
Net cash used in investing activities (1,848,228) (1,559,945)
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 5,132,375 (18,794,993)
Cash and cash equivalents at the beginning of the
year 25,058,433 43,853,426
CASH AND CASH EQUIVALENTS AT THE END
OF THE YEAR 4 30,190,808 25,058,433
The attached notes 1 to 16 form part of these financial statements.

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Page 5 of 16
Abu Dhabi Accountability Authority
STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS
For the year ended 31 December 2011
Description Final
budget amounts
AED
Actual
amounts on
comparable
basis
AED Difference
AED
RECEIPTS
Contribution from Government of Abu Dhabi 136,237,000 108,385,504 27,851,496
Revenue from non-subject entities - 915,825 (915,825)
Total Receipts 136,237,000 109,301,329 26,935,671
EXPENDITURES
Chapter one - Salaries, wages and other benefits
Basic salary and other allowances 94,938,000 84,582,083 10,355,917
Tuition allowance 2,640,000 2,574,105 65,895
Contributions to pension fund and retirements benefit plan 3,352,000 2,748,540 603,460
End of service benefits 3,600,000 1,134,357 2,465,643
Medical insurance 2,871,000 2,495,727 375,273
Staff training 2,000,000 688,533 1,311,467
Other expenses 550,000 380,592 169,408
Total salaries, wages and other benefits 109,951,000 94,603,937 15,347,063
Chapter two – Other operating expenditure
Recruitment fees 800,000 233,349 566,651
Consultancy fees 8,162,000 910,148 7,251,852
Office rent and other related expenses 4,605,000 3,553,669 1,051,331
Motor vehicles expenses (insurance, maintenance and fuel) 140,000 72,725 67,275
Operation and maintenance of computers, furniture and office
equipment 1,617,000 1,358,356 258,644
Books and professional and scientific subscription 110,000 108,390 1,610
Advertising and corporate identity expenses 500,000 100,950 399,050
Business travel expenses 1,500,000 504,628 995,372
Miscellaneous expenses 3,050,000 1,371,336 1,678,664
Total other operating expenditure 20,484,000 8,213,551 12,270,449
NET OPERATING RECEIPTS 5,802,000 6,483,841 (681,841)
Chapter three - Capital expenditure
Motor vehicles 80,000 64,000 16,000
Furniture and office equipment 324,000 108,480 215,520
Computer equipment 2,623,000 381,425 2,241,575
Leasehold improvements 100,000 18,000 82,000
Intangible assets 2,225,000 925,825 1,299,175
Capital work in progress (ADAA building) 450,000 446,526 3,474
Proceeds from sale of property and equipment - (96,028) 96,028
Total capital expenditure 5,802,000 1,848,228 3,953,772
NET RECEIPTS - 4,635,613 (4,635,613)
The attached notes 1 to 16 form part of these financial statements.
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: “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.

Accountability Report 2012 68
Page 6 of 16
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
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 activities are 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 2011, the Authority had 135 employees (2010: 138 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).
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 25 Employee Benefits – The Standard is effective from 1 January 2011 and prescribes the
accounting and disclosure by public sector entities for employee benefits. It is based on IAS 19 “Employee
Benefits”. The Standard deals with four categories of employee benefits, short-term employee benefits,
post-employment benefits, other long-term employee benefits and termination benefits. Benefits that
are not consideration in exchange for service rendered by employees or past employees of reporting
entities are not within the scope of this Standard. The adoption of the standard did not have any impact
on the financial position or performance of the Authority.

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Page 7 of 16
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
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 2011:
IPSAS 27 Agriculture - effective for annual periods beginning on or after 1 April 2011.
IPSAS 28 Financial Instruments: Presentation - effective for annual periods beginning on or after 1
January 2013.
IPSAS 29 Financial Instruments Recognition and Measurement - effective for annual periods beginning
on or after 1 January 2013.
IPSAS 30 Financial Instruments Disclosures - effective for annual periods beginning on or after 1
January 2013.
Improvements to IPSASs - effective for annual periods beginning on or after 1 January 2013.
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
There are no 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.
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. When
services are delivered and the condition attached to the funds are met the contributions are recognized
as revenues in the statement of financial performance equivalent to the extent of the expense incurred
for the year less other income.
Other income
Other income 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.

Accountability Report 2012 70
Page 8 of 16
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
continued
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 or the remaining period of lease 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. No provision was required in 2011 (2010: nil) and no
bad debts were written off during the year (2010: nil)
Years
Motor vehicles 4
Furniture and fixtures 4
Computers 3
Leasehold improvements 4
Machinery and office equipment 3

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2011 AUDITED FINANCIAL STATEMENTS
Page 9 of 16
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
continued
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 Employees’ end of service benefits
Employees’ end of service benefits are calculated in accordance with IPSAS 25. This requires the use of
actuarial techniques to make a reliable estimate of the amount of benefit that employees have earned in
return for their service in the current and prior periods and to make estimates about employee turnover
and financial variables and to discount those benefits using the Projected Unit Credit Method.
3.7 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.
3.8 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.

Accountability Report 2012 72
Page 10 of 16
4 BANK BALANCES AND CASH
5 DEBTORS AND OTHER DEBIT BALANCES
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
2011
AED
2010
AED
Bank balances and cash 30,182,808 25,050,433
Petty cash 8,000 8,000
30,190,808 25,058,433
2011
AED
2010
AED
Prepaid expenses 2,189,703 2,289,779
Advances and loans to employees 4,121,439 4,868,218
Other debtors - 794,161
6,311,142 7,952,158

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2011 AUDITED FINANCIAL STATEMENTS
Page 11 of 16
6 PROPERTY AND EQUIPMENT
Motor
vehicles
AED
Furniture
and
fixtures
AED Computers
AED
Leasehold
improvements
AED
Machinery
and office
equipment
AED Total
AED
2011
Cost:
As at 1 January 2011 695,000 2,574,921 4,005,909 3,807,879 1,276,102 12,359,811
Additions 64,000 - 381,425 18,000 108,480 571,905
Disposals (258,000) - (266,439) - - (524,439)
As at 31 December 2011 501,000 2,574,921 4,120,895 3,825,879 1,384,582 12,407,277
Accumulated depreciation:
As at 1 January 2011 550,392 1,119,470 2,911,857 2,105,095 956,562 7,643,376
Depreciation for the year 40,141 631,228 772,557 953,257 296,735 2,693,918
Disposals (258,000) - (266,439) - - (524,439)
As at 31 December 2011 332,533 1,750,698 3,417,975 3,058,352 1,253,297 9,812,855
Net carrying amount:
As at 31 December 2011 168,467 824,223 702,920 767,527 131,285 2,594,422
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
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011

Accountability Report 2012 74
Page 12 of 16
7 INTANGIBLE ASSETS
8 PAYABLES AND OTHER CREDIT BALANCES
9 EMPLOYEES’ END OF SERVICE BENEFITS
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
Computer Software
2011
AED
2010
AED
Cost:
As at 1 January 4,213,470 4,126,717
Additions 745,825 86,753
As at 31 December 4,959,295 4,213,470
Accumulated amortization:
As at 1 January 2,898,423 1,509,537
Amortization for the year 1,464,200 1,388,886
As at 31 December 4,362,623 2,898,423
Net book value:
As at 31 December 596,672 1,315,047
2011
AED
2010
AED
Trade payables 947,874 2,025,695
Accrued expenses 1,820,436 1,772,057
2,768,310 3,797,752
2011
AED
2010
AED
Balance as at 1 January 11,532,269 11,898,513
Charge for the year 4,672,268 2,588,251
End of service benefits paid during the year (1,134,357) (2,954,495)
Balance as at 31 December 15,070,180 11,532,269

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Page 13 of 16
10 GENERAL AND ADMINISTRATIVE EXPENSES
11 RELATED PARTY TRANSACTIONS
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
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:
2011
AED
2010
AED
Business travel 504,628 1,090,021
Recruitment fees 525,261 482,037
Consultancy fees 755,172 2,364,293
Rent 2,574,777 2,248,008
Computer maintenance 1,469,489 1,163,765
Other expenses 1,951,865 3,683,276
7,781,192 11,031,400
2011
AED
2010
AED
Salaries and other benefits 14,106,527 13,445,415
Employees’ end of service benefits 774,275 469,547
Number of key management personnel 9 9
2011
AED
2010
AED
Contribution from Government of Abu Dhabi 109,616,477 109,180,583

Accountability Report 2012 76
Page 14 of 16
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
12 COMMITMENTS AND CONTINGENCIES
As at 31 December 2011, the Authority had capital commitments, which are contracted but not provided
for amounting to AED 7,224,475 (2010: nil).
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. This comprises prepayments, advances
and loans to employees. The Authority seeks to reduce the credit risk by limiting amounts loaned to
employees and monitoring existing outstanding debtor 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.

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Page 15 of 16
15 STATEMENT OF COMPARISON OF BUDGET AND
ACTUAL AMOUNTS
15.1 The Authority’s budget is prepared on a cash basis 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 2/2011 issued on 16 June 2011.
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 na-
ture of expenses in the statement of financial performance, whereas the budget is prepared
on a cash basis. The amounts in the financial statements were recast from the accrual basis
to the 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 com-
parable 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 ac-
counting basis. For the Authority, the budget is prepared on the 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.
Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011

Accountability Report 2012 78
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Abu Dhabi Accountability Authority
NOTES TO THE FINANCIAL STATEMENTS
31 December 2011
2011
Operating
AED
Investing
AED
Financing
AED
Total
AED
Actual amount on comparable basis as
presented in the statement of budget and
actual amounts 6,483,841 (1,848,228) - 4,635,613
Entity differences 496,762 - - 496,762
Actual amount in the cash flow
statement 6,980,603 (1,848,228) - 5,132,375
15 STATEMENT OF COMPARISON OF BUDGET AND
ACTUAL AMOUNTS
continued
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.
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 2011 is presented below.
16 COMPARATIVE FIGURES
Comparative figures were reclassified to confirm to the current year presentation with respect to non-
current portion of Government of Abu Dhabi account transferred from current liability to non-current
liability.
15.9 Entity differences represent payments of housing loans to employees of AED 496,762.
15.10 Explanation of differences between actual amounts and budget
The total budget difference amount of AED 32 million is primarily attributable to an underspend
against budgeted operating and capital expenditure.
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 108 million from the Government
of Abu Dhabi as opposed to an approved and available budget of AED 136.2 million for the year 2011.

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