From the Managing Partner – UAE

A Quarterly Newsletter from UAE and Oman

VOL 21 ISSUE 1 January 2019

Season’s Greeting and a Happy New Year to you all. I hope that 2019 will be prosperous for all of us.

Recent reports suggest that private sector output has continued to rise although indices are not as high as this time last year. This needs to be viewed with some caution, however, as much of this increase seems to be on the back of price discounting. And this appears to be across sectors. This comes at a time when costs continue to increase, putting a strain on margins and will not be sustainable in the long run. I have seen a similar pattern in the education sector – the greatly welcomed fee freeze combined with discounting or even fee cuts by some premium priced schools. Parents understandably want the quality of education and facilities delivered to be unchanged or improved of course. All of which comes at an increased cost, squeezing margins.

So, I think companies will continue to be cautious in 2019, certainly in H1, and should keep a close watch on receivables – “cash is king”.

This issue features and an interview with the dynamic founder-Chairman of Al Tara Group, Mr. Ramesh Khanchandani, who shares his journey with us. Given that we will soon move into accounts finalisation and audits, we have two articles on international financial reporting standards, one on IFRS 15 – Revenue from Contracts with Customers, which kicked in from 1 January 2018 and the other on IFRS 16 – Leases which kicks in from 1 January 2019.

Please feel free to write (update@pkfuae.com) if you would like to express an opinion on any matter inside.

GRAHAM MARTINS