Saudi Arabia requires certain companies to have their annual financial statements audited by a SOCPA-licensed auditor. This guide covers who must be audited under the Companies Law and CMA rules, who can perform the audit, deadlines, and filing with the Ministry of Commerce (MC) and the Capital Market Authority (CMA). See SOCPA standards, financial statements, AGM requirements, and corporate governance.
Overview
The Saudi Companies Law and implementing regulations require joint stock companies (JSCs) and certain limited liability companies (LLCs) to have their financial statements audited annually. Listed companies and entities regulated by the CMA must also comply with CMA audit and disclosure rules. The auditor must be licensed by the Saudi Organization for Chartered and Professional Accountants (SOCPA). The audited statements are approved at the annual general meeting (AGM) and filed with the Ministry of Commerce and, where applicable, with the CMA.
Who Must Be Audited
Mandatory audit typically applies to: (1) joint stock companies (whether listed or closed); (2) LLCs that exceed size criteria (e.g. revenue, assets, or number of partners as set in the regulations); (3) listed entities and entities subject to CMA regulations. Small LLCs below the threshold may be exempt; the exact thresholds are in the Companies Law and MC regulations. Branches of foreign companies may be required to have their Saudi branch accounts audited depending on the parent's obligations and any local requirements. Check the current thresholds and any sector-specific rules (e.g. fintech, insurance).
| Entity type | Audit required |
|---|---|
| Joint stock company (JSC) | Yes |
| LLC above regulatory threshold | Yes |
| Listed / CMA-regulated | Yes (plus CMA rules) |
| Small LLC (below threshold) | May be exempt |
Who Can Audit
The auditor must be licensed by SOCPA. For listed companies, the auditor must also be approved by the CMA. Audit firms (including international networks' Saudi member firms) must have the appropriate SOCPA licence and, for listed entities, CMA approval. Rotation and independence rules may apply. Do not engage an unlicensed individual or firm for statutory audit — the report will not be accepted by MC or CMA.
Scope and Standards
The audit is performed in accordance with SOCPA auditing standards, which are aligned with International Standards on Auditing (ISA). The auditor reports on whether the financial statements present fairly, in all material respects, the financial position and performance in accordance with the applicable financial reporting framework (e.g. SOCPA standards for SMEs or IFRS where required). See SOCPA standards and financial statements.
Deadlines
Companies must prepare and have their financial statements audited within the period set by the Companies Law and regulations — typically within a few months after the financial year-end. The AGM must be held within a specified period (e.g. six months after year-end for JSCs) to approve the financial statements and the auditor's report. Listed companies must meet CMA disclosure deadlines. Plan with your auditor and company secretary to close the books, complete the audit, and convene the AGM on time.
Filing with Ministry of Commerce and CMA
Audited financial statements (and the auditor's report) are filed with the Ministry of Commerce as part of annual compliance. Listed companies and CMA-regulated entities must also file with the CMA and comply with continuous disclosure rules. Filing is done through the relevant portals (e.g. MC portal, CMA Tadawul). Late filing can result in penalties and, for listed companies, suspension or other regulatory action.
AGM and Approval
The annual general meeting must approve the audited financial statements and the appointment (or reappointment) of the auditor for the next year. The board presents the statements and the auditor's report to the shareholders. See AGM requirements for notice periods, quorum, and voting. Minutes and evidence of filing should be retained for compliance.
Audit Compliance Checklist
- Confirm whether your company type and size trigger a mandatory audit under the Companies Law and MC regulations.
- Appoint a SOCPA-licensed auditor (and CMA-approved if listed) before year-end; agree scope and timeline.
- Prepare financial statements in accordance with applicable framework (SOCPA/IFRS) and provide supporting records to the auditor.
- Complete the audit and obtain the signed auditor's report in time for the AGM and filing deadlines.
- Hold the AGM to approve the financial statements and file with MC (and CMA if applicable).