RIYADH — The Ministry of Commerce emphasized the importance of commitment on the part of companies to prepare and file their financial statements. It noted that this would be instrumental in producing positive impact on enhancing administrative performance, increasing transparency, strengthening the confidence of investors, shareholders, creditors, and banks, apart from enabling regulatory bodies to perform their roles effectively.
According to the Companies Law, responsibility for preparing and filing financial statements rests with the company’s chairman, the company’s manager, the chairman of the board of directors, or the board of directors in the case of a simplified joint-stock company.
Filing financial statements is an obligation for all companies, as stipulated by the Companies Law. Paragraph 2 of Article 17 states: “Financial statements must be prepared for the company at the end of each fiscal year in accordance with the accounting standards adopted in the Kingdom, and these statements must be filed in accordance with the regulations within 6 months from the end of the fiscal year, as specified by the provisions of the law.”
The ministry indicated that preparing and filing financial statements contributes to improving a company’s administrative performance through performance evaluation. Financial compliance strengthens oversight of various departments, measures operational efficiency, and supports informed decision-making based on accurate financial indicators.
Compliance with financial statement preparation and filing also enhances investor and shareholder confidence by enabling them to assess profitability and return on investment, evaluate financial and operational risks, and compare companies and different investment opportunities.
The obligation to file financial statements also benefits creditors and banks by allowing them to assess repayment capacity and liquidity levels, determine financing terms, and monitor compliance with loan and financing conditions. Financial statements enable regulatory bodies to verify companies’ compliance with regulations, thereby contributing to investor protection and economic growth.
The ministry has identified the entities responsible for preparing and filing financial statements based on the company’s legal structure. Companies can file their financial statements electronically through the Qawaem platform, which is an official digital system affiliated with the Ministry of Commerce and the Saudi Business Center for the direct deposit and filing of enterprise financial statements.
Source: Saudi Gazette