21.1 C
Dubai
Friday, February 23, 2024
spot_img

DFSA Imposes Fine on Ex-CFO of Listed REIT for Involvement in Misleading Statements and Accounting Violations Breaches

In a recent development, the Dubai Financial Services Authority (DFSA) has taken a significant step by publishing a Decision Notice that imposes a monetary fine on Mr. Remi Ishak, who held the position of Chief Financial Officer (CFO) at Equitativa (Dubai) Limited (Equitativa) and Emirates REIT (CEIC) PLC (Emirates REIT). This decision comes after a thorough investigation and highlights the critical role of CFOs in ensuring financial transparency and adherence to regulatory standards within the financial sector.

Key Violations Uncovered

The Decision Notice issued by the DFSA outlines several key violations that led to the penalty imposed on Mr. Ishak. The violations pertain to actions taken during his tenure as CFO, and they carry serious implications for the financial sector. The DFSA had previously issued a Decision Notice penalizing Equitativa for a range of violations, which included making misleading statements concerning Emirates REIT, failing to prepare financial statements in compliance with International Financial Reporting Standards (IFRS), and neglecting to take appropriate measures to ensure the relevant information was conveyed to the auditors. The investigation into these breaches has revealed that Mr. Ishak was knowingly involved in these violations, making him subject to the penalties outlined in the Decision Notice.

Misleading Statements and Financial Reporting Breaches: REIT

The Decision Notice specifically highlights an instance from 2018 when Mr. Ishak, in his capacity as CFO, made public statements related to a school property. This school property had previously been vacated by a tenant who had left unpaid rent of over AED 9 million. In his statements, Mr. Ishak indicated that a new tenant had been secured for the property, set to commence occupancy in the upcoming academic year, scheduled for September 2019. However, these statements proved to be misleading, as they were not backed by a binding offer or agreement at the time. As a result, they inaccurately implied that the asset’s revenue and valuation would remain unaffected.

Violation of Regulatory Principles: REIT

In light of the above-mentioned violations, the DFSA’s investigation concluded that Mr. Ishak had breached Principle 2 of its Principles for Authorized Individuals. This principle emphasizes the need for individuals in authorized roles to act with due skill, care, and diligence. However, Mr. Ishak’s actions as a Finance Officer at Equitativa in relation to the matters addressed in the Decision Notice failed to meet these standards, leading to the DFSA’s disciplinary actions.

Importance of Financial Accuracy: REIT

Ian Johnston, Chief Executive of the DFSA, underscored the crucial role played by CFOs of Public Funds and Listed Funds in ensuring the accuracy and fairness of financial statements and related public announcements. He emphasized that CFOs bear the responsibility of guaranteeing that all relevant facts essential to the preparation of financial statements are presented in a comprehensive and transparent manner to external auditors. This diligence is fundamental in maintaining the integrity of financial reporting within the financial sector.

Also Read

iMaker Group: A Conversation with Visionaries Arch. Baraa & Arch. Ahmed Al Refai

“Explore the Future: Immerse in Next-Gen Digital Experiences”

Related Articles

Dubai traffic flow ; RTA’s Road Closure Plan for Smooth UAE Tour 2024 Traffic

Dubai traffic, RTA Announces Road Closures for UAE Tour 2024As Dubai prepares to host the UAE Tour 2024, the RTA's proactive measures and timely...

UAE Hints at 6-Day Eid Al Fitr Break as Ramadan 2024 Dates Emerge

UAE as Likely Ramadan 2024 Dates Unveiled, Anticipated 6-Day Break for Eid Al Fitr The commencement of the holy month of Ramadan holds great significance,...

Ramadan Delight: Retailer Slashes Prices on 10,000 Items, Unleashes Dh5,000 Gift Cards for UAE Shoppers

Ramadan Joy: Retailer Slashes Prices on 10,000 Items, Unveils Dh5,000 Gift Cards, These essential products, comprising approximately 80 percent of the total offerings, span across...

NMC Walkathon in Mohammed Bin Zayed City, Strength in Numbers with Over 4,000 Participants

NMC Royal Hospital - Mohammed Bin Zayed City, expressed his profound delight at the overwhelming turnout and community enthusiasm. In a vibrant display of community...

UAE 27 Cloud-Seeding Missions Transform Dry Winter into Record-Breaking Rainfall in 2024

UAE 27 cloud-seeding missions, igniting a transformative journey that turned a once arid winter into a season of record-breaking rainfall. The UAE recently conducted an...

Latest Articles