Commerce Ministry urges companies to file financial statements to boost transparency and investor confidence

The Ministry of Commerce has emphasized the importance of companies preparing and submitting their financial statements, citing their positive impact on improving administrative efficiency, raising transparency, supporting the confidence of investors, owners, creditors, and banks, and enabling regulatory authorities to perform their roles effectively.

In a statement posted on its X platform account, the ministry said that under the Companies Law, responsibility for preparing and submitting financial statements lies with the company’s president, manager, or chairman of the board, or with the board of directors in the case of a simplified joint stock company.

Submitting financial statements is a legal obligation for all companies under the Companies Law. Paragraph (2) of Article (17) stipulates that companies must prepare financial statements at the end of each fiscal year in accordance with the accounting standards approved in the Kingdom, and submit these statements as specified by regulations within six months of the end of the fiscal year, in line with the law’s provisions.

The ministry noted that preparing and submitting financial statements helps improve a company’s administrative performance by evaluating its financial results, enhancing oversight of its various departments, measuring operational efficiency, and supporting decision-making based on accurate financial indicators.

Compliance with preparing and submitting financial statements also boosts the confidence of investors and owners by enabling them to assess profitability and return on investment, evaluate financial and operational risks, and compare different companies and investment opportunities.

Filing 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 authorities to verify companies’ compliance with laws and regulations, and to strengthen investor and economic protection.

The ministry specified the individuals responsible for preparing and submitting financial statements according to the company’s legal structure. Companies can submit their financial statements electronically via the Qawaem platform: https://qawaem.bc.gov.sa.