When does a Saudi company need an auditor, and who signs the audit report?

Start with appointment, then test the exemption

The Law provides for an auditor or auditors licensed to practise in the Kingdom. Appointment, fees, term and scope are determined by the partners, general assembly or shareholders, as applicable. Statutory appointment is therefore different from simply requesting a service quotation.

The Ministry of Commerce explains the small/micro-company size test for this exemption: meeting at least two criteria out of annual revenue not exceeding SAR 10 million, assets not exceeding SAR 10 million, and no more than 49 employees. These are exemption-test thresholds, not service prices or a universal SME definition for all purposes.

The Law connects small/micro-company qualification with the first financial year after registration or two consecutive financial years. Do not decide using only this month's revenue or today's headcount. Have the relevant assessment period and data checked.

What can prevent exemption despite a small size?

Exceptions include an auditor requirement in the incorporation document; capital-market listing; issuance of debt instruments, traded financing sukuk, preferred shares or redeemable shares; an appointment requirement under other relevant laws; and foreign-company status. They also include owning another company or being its subsidiary, unless all relevant companies qualify as small or micro.

Partners or shareholders representing at least 10% of interests or voting shares may also request appointment in writing under the applicable rules. General partnerships have a separate exemption provision and specific exceptions, so do not automatically apply the LLC checklist to them.

Classification matters: the Law gives Saudi nationality to a company incorporated under its provisions. Do not automatically equate a Saudi-incorporated company with foreign shareholders with the “foreign company” category in the exemption exceptions. Have the entity structure assessed before deciding.

Does audit exemption remove statement preparation or filing?

No. The Law requires records, financial-statement preparation and filing within six months of the financial year end. The Ministry confirms electronic Qawaem filing for all company types. It also describes attaching a declaration, when filing under exemption, that the appointment requirement does not apply and that no owner holding the prescribed percentage has requested an auditor.

Who performs the audit, and who remains responsible for the statements?

The independent licensed auditor issues the report on the financial statements under auditing standards approved in the Kingdom. The Law restricts combining audit with management and other services. Do not assume that the firm's bookkeeping role automatically makes it suitable for the independent audit as well.

Responsibility for preparation and filing remains with the management body specified for the company's form: for an LLC, its manager or board of managers. Assistance with filing can be agreed with the firm, but this does not transfer management's statutory responsibility or guarantee an unmodified audit opinion.

Your next step with Aleem and the independent auditor

Request Audit and auditor appointment through an accredited, appropriately licensed partner firm. Aleem coordinates audit requests and follows up to delivery, while the client contracts with and pays the firm directly. The firm performs the professional work and issues its report after independence and engagement-acceptance checks. Aleem does not perform the audit, sign its report or receive a referral commission. The audit and statement-filing assistance are scoped in writing, without guaranteeing government acceptance or the auditor's opinion.

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