The Registration Authority of Abu Dhabi Global Market has fined audit firm PKF Accountants and Business Advisers and its registered audit principal, Saranga Lalwani, a total of $100,000. The penalties follow an inspection that found significant deficiencies in an audit the two carried out for an entity registered in ADGM.
PKF was fined $65,000 and Ms Lalwani $35,000. The authority announced the decision in a statement on Friday, October 9. Its action stems from an on-site inspection that examined whether the firm complied with ADGM’s rules for auditors and assessed the quality of its audit work. The statement, as reported, did not identify the entity whose accounts were audited.
According to the regulator, the firm and its audit principal did not carry out the audit or prepare the audit report in line with International Standards on Auditing, which the Companies Regulations (Auditors) Rules 2023 require. They also failed to exercise due skill, care and diligence. One finding stands out: PKF dismissed the risk of fraud arising from management override of controls. Under the international standards, auditors must treat that risk as present in every audit and cannot rule it out. The inspection also found that the firm did not assess fraud risks, did not collect enough appropriate audit evidence, kept inadequate documentation and could not show enough evidence that the audit principal was involved in the work.
The authority said registered auditors and audit principals must follow the professional standards that apply to them. It added that the case “reinforces the importance of robust audit practices” and warned that regulatory failures would lead to enforcement action. The fine is the latest in a series of penalties handed out by UAE financial regulators. Earlier this month the Dubai Financial Services Authority fined wealth manager Vault Wealth Dh401,000, or $109,200, for carrying out transactions without authorisation. In May 2025, ADGM fined 23 entities for breaching its regulations.
For companies registered in ADGM, the case is a reminder that the quality of their auditors’ work is under direct scrutiny from the regulator. Firms that audit entities in the financial centre can expect inspections to examine fraud risk assessments and file documentation closely. The authority has framed its enforcement push as a way to protect the integrity and reliability of the UAE’s financial system, and further inspection-led cases are likely as it continues that approach.
