RIYADH — The Ministry of Commerce has stressed the importance of companies preparing and filing their financial statements on time, noting that timely compliance can improve administrative performance, strengthen transparency and boost the confidence of investors, shareholders, creditors and banks.

The ministry said timely financial reporting also helps regulatory authorities carry out their responsibilities more effectively by providing accurate financial information for oversight and monitoring.

Under the Companies Law, responsibility for preparing and filing financial statements lies with the company’s chairman, manager, chairman of the board of directors, or the board of directors in the case of a simplified joint-stock company.

The ministry confirmed that filing financial statements is mandatory for all companies. Paragraph 2 of Article 17 of the Companies Law requires companies to prepare financial statements at the end of each fiscal year in accordance with accounting standards adopted in the Kingdom and file them within six months from the end of the fiscal year, in line with the applicable regulations.

According to the ministry, preparing and filing financial statements can improve administrative performance by helping companies evaluate their performance, strengthen internal oversight, measure operational efficiency and make informed decisions based on reliable financial indicators.

Financial compliance also gives investors and shareholders access to information that can help them assess profitability and potential returns, evaluate financial and operational risks, and compare companies and investment opportunities.

The ministry noted that financial statements are also important for creditors and banks, allowing them to assess a company’s ability to repay obligations and its liquidity, determine financing terms and monitor compliance with loan and financing requirements.

For regulatory authorities, the availability of financial statements helps verify companies’ compliance with relevant regulations, supporting investor protection and contributing to economic growth.

The ministry has identified the parties responsible for preparing and filing financial statements according to each company’s legal structure. Companies can submit their financial statements electronically through the Qawaem platform, an official digital system affiliated with the Ministry of Commerce and the Saudi Business Center for the direct deposit and filing of companies’ financial statements.

Source:Saudi Gazette