Saudi Arabia
- National professional accountancy organisation website: Saudi Organization for Certified Public Accountants
- Response to IFAC Member Body Survey on Standard Setting and Regulation
- Participant in the Asian-Oceanian Standard-Setters Group (AOSSG)
Financial reporting framework in Saudi Arabia
The banking and insurance regulator requires all Saudi Arabian banks and insurance companies whose shares are listed on the Saudi Stock Exchange to publish financial statements in conformity with IFRSs.
All other listed companies in the Kingdom of Saudi Arabia, as well as unlisted companies, must follow accounting standards generally accepted in the Kingdom of Saudi Arabia as issued by the Saudi Organization for Certified Public Accountants (SOCPA). The SOCPA was created by Royal Decree in 1992. It operates under the supervision of the Ministry of Commerce. Its objectives include:
- Review, develop, and approve accounting standards (SOCPA does this through its Accounting Standards Committee)
- Review, develop, and approve auditing standards (SOCPA does this through its Auditing Standards Committee)
In 2012, the SOCPA took up an IFRS transition project (completed in 2016) that requires listed entities to report using the "national standards that are closely converged with full IFRSs" beginning with financial statements prepared for financial periods starting at 1 January 2017. Additionally, unlisted entities will be required to report under IFRS for SMEs as adopted in Saudi Arabia beginning with financial statements prepared for financial periods starting at 1 January 2018 (early adoption beginning in 2017 permitted, if an entity is part of a listed group).
"National standards that are closely converged with full IFRSs" as issued by the SOCPA are IFRSs with some options removed and some disclosure requirements added as well as additional standards and pronouncements endorsed by the SOCPA for matters not covered by IFRSs but that are relevant in Saudi Arabia (for example for religious reasons). Similarly, additional disclosure requirements have been added to the IFRS for SMEs.
Details on the IFRS transition plan are available on the SOCPA website.