The Ministry of Commerce and Industry has renewed its call to all companies and institutions required by law to promptly file their financial statements in the “Qawa’im” program before January 19, 1437 AH, corresponding to November 1, 2015, in order to avoid suspension of their commercial registrations and the penalties stipulated in the Companies Law, which may include imprisonment for up to one year and a fine in the event of failure to submit their financial statements to the “Qawaem” program or if they are submitted later than the statutory deadline of six months from the end of the company’s or institution’s fiscal year.
The companies and institutions legally required to file their financial statements are: joint stock companies, mixed joint stock companies, foreign joint stock companies, joint stock companies with Gulf capital, branches of foreign joint stock companies, limited liability companies, mixed limited liability companies, foreign limited liability companies, and limited liability companies with Gulf capital. This requirement also applies to branches of foreign limited liability companies, joint-stock partnerships, partnerships with Gulf capital, simple partnership branches of foreign companies, joint-stock companies with Gulf capital, joint-stock branches of foreign companies, branches of foreign sole proprietorships, and branches of licensed foreign companies.
In the same context, Turki Al-Taimi, the official spokesperson for the Ministry of Commerce and Industry, explained that the volume of financial statement filings through the “Qawaem” program has been growing steadily since the program’s launch in January 2015, noting significant responsiveness and cooperation from companies in filing their financial statements. The Ministry’s official spokesperson confirmed that the growth rate of financial statement filings for joint-stock companies has reached nearly 70 percent of the total number of joint-stock companies registered with the Ministry over the nine months since the program’s launch.
The “Qawa’im” program is one of the initiatives of the Ministry of Commerce and Industry in cooperation with the Saudi Organization for Certified Public Accountants and the Zakat and Income Authority. It aims to convert paper financial statements into electronic format and file them automatically, which enhances the credibility and transparency of financial statements for stakeholders, in addition to expediting the provision of highly accurate information to relevant authorities such as the Zakat and Income Authority and others, and establishing a financial and economic information database to support national databases and information systems.
The program also includes linking the financial statements of companies and institutions to the International Standard Industrial Classification of All Economic Activities (ISIC), which is endorsed by the United Nations, which will enable the financial analysis of various economic sectors and activities, the study and monitoring of their performance indicators, and the distribution of investments by activity.
