Dubai is known as the global financial hub for businesses, hence maintaining accuracy in financial communication and reporting is not a luxury but rather a necessity. This implies that whether you’re a business of multinational status operating in the free zone of UAE or a local entity that serves international clients but is based in UAE or simply a financial institution that specializes in preparation of reports for independent regulators, it is essential to get documents financially translated into the local language. This sort of financial translation does not only mean translating numbers, because lets be honest here anyone can do that. Rather it is about ensuring absolute precision, confidentiality and compliance with international plus UAE reporting standards.
The Risk is Higher for Financial Translation in Dubai
There is no doubt that Dubai’s economy is based on cross-border investment flows, global enterprise trade along with an increasing financial services sector that is now spreading all over the world. Businesses operating within the region are known to prepare audit reports, balance sheets, financial statements, investor reports, and due diligence reports among other official, publicly-traded documents in more than one language. However, the most common method of translation till date is still from English to Arabic in order to meet the stakeholder expectations and comply with regulatory standards.
This is not the same as marketing companies or general business translations as financial translation carries important legal and economic implications for the stakeholders. Any single term that is mistranslated within an audit report can be scrutinized and lead to misunderstandings by investors and compliance parties which often than not results in reputation damage for the company. Dubai is also known for its rigid financial governance bodies including the UAE Ministry of Economy, its Central Bank and the Dubai Financial Services Authority (DFSA) which are responsible for maintaining legal accountability of all financial intermediaries within the nation. Hence certified financial translators’ job is to ensure that financial reports are not only linguistically accurate but also satisfy formal requirements such as those set by auditors and tax authorities.
Why is Financial Translation Complicated
It is largely believed that financial translation is one of the most demanding specialties in the language translation industry as it requires more than just fluency in two languages. It goes a step beyond where translators must have developed an in-depth understanding of accounting principles, financial instruments, and reporting standards that are used in daily basis such as the International Financial Reporting Standard (IRFS) or the GAAP (Generally Accepted Accounting Principles). This is especially important because phrases like ‘accrued revenue’ or ‘deferred tax liability’ has very specific meaning in financial contexts and merely translating them from English to Arabic will make the term lose its meaning completely. A translator that is unfamiliar with the financial jargons of banks and intermediaries will inadvertently switch the meaning of key categories and figures resulting in misinterpretation. It is also important to note that different regions will interpret financial laws and concepts differently which makes the translator’s job even more difficult. This challenge is multiped 10 times in Dubai as financial documents are found in bilingual tongues. This means one is available in English for international dealings whereas the other is available in Arabic for submission to local authorities and for local stakeholders that the business may be involved in. Only those translators that are certified will be able to ensure that both regulatory compliance and linguistic accuracy is maintained throughout the documents that are released to any third-party or the general public.
What Certified Financial Translators Can and Cannot Do
A certified financial translation in Dubai is only a mere linguist that is an expert in two or more languages but they are also professionals who are known for their skills in financial communication as they can understand the standards set by auditors, legal authorities and accountants among others. In the UAE, a strict legal framework is followed that required financial documents to be submitted to government bodies and courts and are translated only through UAE Ministry of Justice (MOJ) approved translators. These certified translators play an important role in the following aspects:
- Audit preparation: Translators are known to convert balance sheets, P&L statements along with other financial documents from one language to another that are to be submitted to the regulator’s bodies or third-party independent auditors.
- Managing Investor Bonds: Translation of financial disclosures and investor briefings that comply with the international corporate communication standards.
- Facilitating Merges and Acquisition Deals: Translation of due diligence documents, contracts, valuations, agreements and other essential reports that bridge smooth international negotiations.
- Compliance with Tax Authorities: Guaranteeing that the translated financial documents comply with UAE’s tax and VAT documentation standards.
These roles ensure that by hiring a certified financial translator, companies can make sure that all data, terms, interpretation and documentation is consistent and ready for audit. Maintaining this precision reduces the risk of being caught in any discrepancies that often come during audit checks. This could result in serious penalties, delays and even loss in reputation due to shaky investor confidence.
Conclusion
The fast moving landscape in Dubai makes it essential for companies to maintain trust and compliance in literally everything they do. This may involve onboarding a certified financial translator as doing so safeguards that trust of stakeholders is maintained in the financial documentation. That means all the financial data shared communicates the same figures and meaning as it is intended to despite the change in languages or jurisdiction where the data is used.
