President issues law setting up Abu Dhabi Accountability Authority

The President His Highness Sheikh Khalifa bin Zayed Al Nahyan, in his capacity as the Ruler of Abu Dhabi, has issued a law establishing the Abu Dhabi Accountability Authority as an independent authority with an independent juridical personality.

The Abu Dhabi Accountability Authority will function under the authority of the Crown Prince of Abu Dhabi and shall replace the Abu Dhabi Audit Authority.

The new law has nine chapters in all with a total of 28 articles, which contain definitions, objectives, chairman and employees, subject entities, powers, function and duties, financial resources, violations and disciplinary actions, and final provisions.

The following is the full text of the law No.14 of Year 2008 pertaining to the establishment of Abu Dhabi Accountability Authority:

We, Khalifa bin Zayed Al Nahyan, Ruler of Abu Dhabi,- pursuant to Law Number (1) of 1974 reorganising the Government of the Emirate of Abu Dhabi (as amended), - and Law Number (2) of 1971 pertaining to the National Consultative Council (as amended), - and Law Number (2) of 2000 pertaining to the Civil Retirement Pensions and Benefits of the Emirate of Abu Dhabi (as amended), - and Law Number (6) of 2004 reorganising Abu Dhabi Audit Authority, - and Law Number (1) of 2006 pertaining to Civil Service in the Emirate of Abu Dhabi, - and Law Number (23) of 2006 pertaining to the Judicial Department of the Emirate of Abu Dhabi, - and Federal Law Number (8) of 1984 pertaining to Commercial Companies (as amended), - And Law Number (22) of 1995 pertaining to the Organisation of Auditors Profession (as amended), - and in accordance with what has been presented to the Executive Council and the Council's approval thereof, - we hereby issued the following Law:

Chapter One: Definitions Article (1): In applying the provisions of this law, the following words and terms shall have the meanings hereinafter appearing against each of them, unless otherwise indicated by the context:

The State: The State of the United Arab Emirates.

The Emirate: The Emirate of Abu Dhabi

The Ruler: The Ruler of the Emirate of Abu Dhabi

The Government: The Government of the Emirate of Abu Dhabi

The Executive Council: The Executive Council of the Emirate

The Crown Prince: The Crown Prince of Abu Dhabi and The Chairman of the Executive Council Local Departments: The Departments of the Abu Dhabi Government and other similar local Government entities

The Authority: Abu Dhabi Accountability Authority

Subject Entities: Entities subject to the Authority's mandate in accordance with this Law The Chairman: The Chairman of the Authority

The Employee: A person appointed by a resolution of the competent employment authority in any Subject Entity

Financial Reports: Include financial statements, accounts, lists and information and other financial reports periodically prepared by the entity

Statutory Auditor: The appointed independent, external or statutory auditor

Chapter Two: Establishment and Objectives of the Authority Article (2): An independent authority to be named “Abu Dhabi Accountability Authority” is hereby established with an independent juridical personality under the authority of the Crown Prince and shall replace the Abu Dhabi Audit Authority.

Article (3): The headquarters of the Authority shall be in the city of Abu Dhabi. Branches for the Authority may be established in the emirate by a resolution of the Crown Prince upon recommendation of the Chairman.

Article (4): The objective of the Authority is to: 1. Ensure that Subject Entities' resources and funds are managed, collected and expended efficiently, effectively and economically.

2. Ensure accuracy of the Financial Reports and compliance of the Subject Entities' with the relevant laws, rules and regulations and governance guidelines as outlined in this Law.

3. Promote accountability and transparency principles at the Subject Entities.

Chapter Three: Chairman and Employees; Article (5): The Authority shall have a Chairman, to be a UAE national, who shall be appointed by an Amiri Decree upon recommendation of the Crown Prince. The Chairman position shall be equivalent to a Government Department chairman position.

Article (6): A Deputy Chairman, to be a UAE national, shall be appointed upon recommendation of the Chairman. The Deputy position shall be equivalent to an Undersecretary of a Department position and shall replace the Chairman in his absence.

The Chairman may delegate to him some of his responsibilities.

Article (7): The Chairman and his Deputy may be paid special allowance by a resolution of the Crown Prince and in the amount he deems suitable.

Article (8): The Chairman shall exercise all responsibilities assigned to him in accordance with the provisions of this law, and in particular the following: 1. Prepare strategy, annual plan, budget and accounts of the Authority for approval by the Crown Prince, before presenting them to the Executive Council.

2. Present the Authority report related to the audit of the Government consolidated Financial Reports to the Crown Prince 3. Submit an annual report on the activities of the Authority to the Crown Prince and the Executive Council.

4. Issue the organisational structure of the Authority after its approval by the Crown Prince.

5. Submit periodical reports to Crown Prince on the results of the Authority activities.

Article (9): Before exercising his duties, the Chairman shall take the following oath before the Ruler: “I swear by almighty God to be loyal to the Ruler and the Country, to honour the constitution and law, to work to safeguard public funds, to perform my duties honestly and sincerely and to maintain the confidentiality of all businesses”.

All other employees of the Authority shall take the same oath before the Chairman.

Article (10): The Chairman, his Deputy or any employee of the Authority must not hold any other public or private employment and must not engage in any financial or commercial or professional business that may conflict with their functions and duties or distort their appearance and integrity.

Nor shall they, during the term of their employment, become members of the boards of directors of any of the Subject Entities.

Article (11): The Chairman must act independently in the exercise and performance of his functions, duties, and responsibilities and must be neutral and objective. The Chairman must ensure that all employees of the Authority maintain proper standards of independence, neutrality and objectivity.

Article (12): The Authority shall have adequate number of employees with proper qualification, experience and degrees that enable them to discharge their duties and responsibilities properly.

The Authority's technical staff are not subject to termination and the Authority's internal rules and regulations shall determine the procedures and rules for their work, discipline and discharge.

Chapter Four: Subject Entities: Article (13): The Authority shall exercise its functions, duties and responsibilities on the following entities:

1. Local Departments.

2. Local council and authorities and other similar entities.

3. Institutions, companies and projects in which the government's share is not less than 50 per cent and also on the subsidiaries of these institutions, companies and projects.

The Crown Prince may instruct the Authority to exercise its powers on any entity in which the government's share is less than the above mentioned 50 per cent or on any entity which is given donations or grants by Government and to submit a report on what it discovers in this respect.

Chapter Five: Functions and Duties: Article (14): The Authority shall exercise the following responsibilities:

1. Audit the Government consolidated financial reports and Subject Entities' financial reports. If the establishment law of a Subject Entity requires that its financial reports be audited by statutory auditor then this entity and its statutory auditor should comply with the rules issued by the Chairman for the appointment of the statutory auditor, and the Authority shall have access to documents, records and working papers of the statutory auditor and shall have the right to receive all information, data and reports as the Authority deems necessary.

2. Review performance and risk; and for doing so the Authority may from time to time; Examine the efficiency, effectiveness and economy of the financial and operational activities of Subject Entitie; Ensure compliance of Subject Entity's with laws, regulations, and rules and governance guidelines; and Examine violations which are investigated by Subject Entities.

3. Provide advice and recommendations and perform other procedures and services to Subject Entities as the Chairman deems reasonable and appropriate.

4. Train and qualify UAE National graduates of universities and institutions and establish training centers as necessary.

5. Issue regulations, rules, guidelines and standards that enable the Authority to exercise its functions and duties by a resolution of the Chairman.

6. Carry out any other functions and duties requested by the Crown Prince.

The Authority shall conduct investigation of complaints referred to it and other violations it may discover.

Chapter Six; Powers Article (15): For the purposes of performing his functions and duties, the Chairman may:

1. Review and examine any document, record or papers and may pursue any person or assets, with the Subject Entity or with any other entity to enable him perform his duties properly. The audit procedures may be carried out at the Authority premises or at any other location.

2. Request evidence and information in writing or verbally.

3. Enter any of the Subject Entities premises, buildings or facilities.

4. Attend ordinary and extraordinary general assembly meetings of Subject Entities.

5. Attend audit committees meetings of Subject Entities.

6. Exercise his functions, duties or powers by means of regular or surprise audits and inspections.

7. Appoint any person or entity to perform the Authority's functions and duties for reasons as deemed necessary.

Article (16): The Authority shall report the results of its work to the Subject Entity, together with its recommendations to take the necessary action to address them. The Subject Entity has to respond to the Authority, if requested to do so, in accordance with the timetable specified by the Authority.

Chapter Seven: FinanciaL Resources Article (17): The Authority's financial resources comprise of: 1. Annual budget allocated to the Authority.

2. Funds collected for services provided to non Subject Entities.

3. Any other financial resources, which are consistent with the objectives of the Authority and approved by the Crown Prince.

Chapter Eight: Volation and Disciplinary Action: Article (18): In application of this law the following are considered violations:

1. To violate the financial rules and provisions of laws, regulations and other legislations applied.

2. To violate the provisions of the general budget of the Emirate, and the budgets of Subject Entities.

3. To violate the provisions regulating purchases, bids, tenders, auctions and stores and/or any other rules, provisions, regulations and financial and accounting circulars that are applied at Subject Entities.

4. Any negligence or failure, which results in a direct financial loss to the Emirate or other public entities or Subject Entities, or which results in, or may lead to, compromising any of its financial interests.

Article (19): The Authority shall deal with violations investigated as follows:

1. File the matter without further action due to inaccuracy or the absence of a violation or its insignificance.

2. Apply disciplinary action if the incident is proved.

3. Referral to the relevant disciplinary committee.

4. Refer the case to relevant public prosecutor office to take the necessary action if the investigation of the violation has indicated the existence of a suspected punitive crime.

Article (20): Each Subject Entity shall:

1. Inform the Authority as soon as any violation is discovered or any incident that may result in a violation.

2. Refer the results of their investigations to the Authority supported with the investigation reports and decisions to be taken within a maximum period of ten days from the date of the decision.

Article (21): With consideration of Civil Service Law applicable in the emirate, the Chairman may refer any employee at the Subject Entity to investigation by the Authority and may decide to deduct the salary for a period not to exceed 15 working days or may decide to refer the employee to a disciplinary committee for any of the following:

1. Committing any act that may result in obstructing the Authority in exercising its functions and duties.

2. Failure to provide the Authority with accounts and supporting documents within the specified time or failure to provide required documents and papers.

3. Failure to reply to the Authority within the specified time or the delay of responding without acceptable reason.

The employee may object to the Chairman's decision within 30 days of his notification with the decision, and the Chairman may reconsider his decision by removing or reducing the penalty or replace it with a lesser penalty.

Article (22): If a disagreement occurs between the Authority and any Subject Entity, the dispute should be raised to the Crown Prince to take the appropriate decision.

Chapter Nine: Final Provisions: Article (23): The Chairman, in exercising his powers, shall not be subject to the authority of any department or any other entity.

Article (24): Based on the Chairman's proposal, the Judicial Department Chairman shall nominate the employees who shall have the authority of judicial officers with respect to all violations that fall within their jurisdictions and are related to their duties and responsibilities.

Article (25): The staff and employees of the Abu Dhabi Audit Authority, who are to be nominated by a resolution of the Chairman, will be transferred to the Authority with the same former employment status.

Article (26): The Authority's employees will be subject to Civil Service Law and Regulations applied in the emirate for matters for which there are no specific provision in this Law and its regulation and rules issued for its implementation.

The Authority's UAE national staff will be subject to the Civil Retirement Pensions and Benefits law of the Emirate.

Article (27): Law Number (6) of 2004 reorganising the Abu Dhabi Audit Authority is hereby repealed.

Any provision that contradicts this law shall be null and void.

Article (28): This law shall take effect and be enforced as of the date of its publication in the Official Gazette.