mc_gov_sa · executive_regulation · processed · 16 chunks
[Non-Text] وزاره التجاره Ministry of Commerce VISION لدا 23:30 العربيه العربيه السعوديه Kingdom of Saudi Arabia Implementing Regulations of The Profession of Accounting and Auditing Law Article 1: 1. The terms and phrases used herein shall have the meanings assigned thereto in Article (one) of the Profession of Accounting and Auditing Law, issued by Royal Decree No. (M/59), dated 27/07/1442H. 2. The term “register” wherever appears in these Regulations shall mean: the certified public accountants database and all amendments or changes thereto. Article 2: The register shall be created in the Saudi Organization for Certified Public Accountants (SOCPA), and it shall contain the following data: 1. The name of the certified public accountant and his identification number; the date, number and expiry date of his practicing license; and data of the licenses previously issued for him. 2. The name of the office or company through which the certified public accountant practices the profession. 3. The names of the partners in the professional company along with the data mentioned in Paragraph (1) of this Article for each partner. Article 3: For a university degree or any higher qualification in a field related to the profession to be deemed valid, it shall fulfill the following criteria: 1. The certificate must be in one of the administrative sciences disciplines or any branch thereof, provided that the license applicant has completed (twenty-one) hours in accounting or one of its branches, or any other certificate considered equivalent thereto by SOCPA. 2. The license applicant must pass the qualifying training program prepared by SOCPA. Article 4: For the work experience to be deemed valid, it shall be gained in the following bodies: 1. Accounting and auditing offices and companies that have been practicing the profession for at least (three) years, provided that they have a certified public accountant with a minimum of (five) years of experience after he obtains the license. 2. Government agencies, joint-stock companies and other establishments that have been practicing the activity for at least (three) years, provided that they have financial statements audited by a certified public accountant and the license applicant have experience in supervisory work over accounting and internal auditing. Article 5: Subject to the conditions stipulated in Paragraph (1) of Article (3) of the Law, part-time license applicants must consider the following: 1. The period for practicing the profession on a part-time basis shall not exceed (three) years, including every period during which he was allowed to practice the profession as apart-time. 2. The percentage of audit hours shall not be less than (6%) of the total hours of each audit for which a report is issued, and the total hours allocated to him shall not exceed (1,000) working hours per year. 3. He shall refrain from providing audit services to joint-stock companies, banks, finance companies, and public bodies and institutions. +966 11 294 4444 | Riyadh 11162 Kingdom of Saudi Arabia | المملكه العربيه السعوديه www.mci.gov.sa 1 [Non-Text] وزاره التحرير Ministry of Commerce VISION dL jgJ 23:30 حولك معريد لسدوز KINGDOM OF SAUDI ARABIA Article 6: 1. Subject to the provisions of Articles (3) and (4) of the Law, license applications shall be submitted in accordance with the forms and procedures determined by SOCPA. 2. Applications must be completed with all the data and attachments specified by SOCPA. 3. When reviewing any application, SOCPA may take any necessary action to verify the validity of the data submitted by the license applicant. The applicant must complete the necessary requirement within a period not exceeding (thirty) days from the date of receiving the notification thereof, otherwise the application shall be void. 4. SOCPA shall review completed applications and submit its recommendation to the Ministry within (five) business days. The applicant shall pay the license issuance fee of (one thousand) riyals. 5. The Ministry shall decide on the application within a period not exceeding (five) business days. 6. The license validity is (five) years for a full-time licensee, and (three) years for a part-time licensee. 7. Subject to the provisions relating to the part-time licensee set out in Article (5) of the Regulations, the renewal of the license shall be at least (90) days before its expiry. Article 7: The license shall be revoked in any of the following cases: 1. Failure to meet any of the conditions and controls stipulated in Article (3) of the Law. 2. The certified public accountant requests revocation of the license, provided that he does not have any existing accounting and auditing operations or outstanding obligations towards his clients or employees. SOCPA may take appropriate actions to verify this matter. 3. The death of the certified public accountant. Article 8: 1. The person whose name is listed in the register - whether a natural or legal- shall provide SOCPA annually, or whenever necessary, with the following data: a. Any information and data that enables SOCPA to monitor the quality and nature of the professional practice of the certified public accountant's office or company through which the professional work is being carried out, compliance to the provisions of the Law and its Regulations, accounting and auditing standards, professional performance quality standards, and professional code of conduct and ethics. b. The names of the establishments he is auditing for. c. The financial statements he has audited and the reports he has prepared therefor which he must submit through the electronic filing system (Qawaem), or any other means to be determined by a decision of the Board. d. Other professional works he has undertaken and determination of their types in accordance with the procedures specified by SOCPA. 2. In all cases, the certified public accountant shall prepare an electronic copy of the engagement file, reports and financial statements within (four) months from the date of issuing the report. The Board sets controls for maintaining electronic copies. Article 9: Unless the Labor Law and related decisions stipulate a higher percentage, the certified public accountant's office or company through which the professional work is carried out shall employ a percentage of Saudi technicians out of the total technical workers not less than the percentages indicated below: +966 11 294 4444 | Riyadh 11162 لارياض Kingdom of Saudi Arabia | المملكه العربيه السعوديه @ SaudiMCI www.mci.gov.sa 2 [Non-Text] وزاره التجاره Ministry of Commerce VISION لدا 23:30 العربيه العربيه السعوديه KINGDOM OF SAUDI ARABIA <table><tr><td>Number of Employees</td><td>Percentage</td></tr><tr><td>(1) to (20) employees</td><td>30%</td></tr><tr><td>(21) to (30) employees</td><td>35%</td></tr><tr><td>(31) to (40) employees</td><td>40%</td></tr><tr><td>(41) to (100) employees</td><td>45%</td></tr><tr><td>More than (100) employees</td><td>50%</td></tr></table> The percentages shall be gradually applied within a maximum period of (five) years from the issuance of the Regulations. The Board shall set the controls which determine the description of the technical personnel mentioned in this Article. Article 10: 1. When the certified public accountant states the maximum audit engagements that he is able to undertake -whether through a private office or a professional company, he shall abide by the following: a. The supervisory hours must not be less than (5%) of the total hours of each report issued by him. b. The supervisory hours of the office or the company shall not exceed (1700) working hours for each fiscal year. 2. As an exception to Paragraph (1/b) of this Article, the audit hours of the certified public accountant can be increased to a maximum of (2200) working hours if the controls stipulated in SOCPA's regulations are met. Article 11: The certified public accountant may not accept any business in which he has a direct or indirect interest in all cases indicated within the rules of professional conduct and ethics approved by SOCPA. The certified public accountant may audit accounts of companies in which he has an interest, provided that this interest is disposed of before accepting the audit operation. Article 12: 1. If, for any reason, the certified public accountant ceases to practice or is suspended from practicing the profession temporarily or permanently - whether he is practicing the profession through a private office or a professional company, he shall follow the next procedures within (thirty) days within 30 days from the date of cessation or suspension: a. Notify SOCPA of the reasons and duration of cessation or suspension. b. Notify SOCPA of the operations under audit which will be affected by the period of cessation or suspension and the measures that will be taken to safeguard the rights of his clients. He also shall coordinate with SOCPA on how to address the effects of such cessation or suspension. 2. Partners in the professional company shall, upon the permanent cessation or suspension of any of their partners, take the necessary statutory procedures in accordance with the Professional Companies Law, and notify SOCPA of the procedures to be followed when assigning the works undertaken by the partner who ceased practicing or is suspended from practicing the profession to other licensed partners. 3. If a part-time certified public accountant wishes to temporarily cease practicing the profession, the cessation period may not exceed a maximum of (six) months throughout the period during which he is allowed to practice the profession on a part-time basis. +966 11 294 4444 | Riyadh 11162 لارياض Kingdom of Saudi Arabia | المملكه العربيه السعوديه @ SaudiMCI www.mci.gov.sa 3 [Non-Text] وزاره التجاره Ministry of Commerce VISION 2013 23:30 دولیک اطریان لسوی KINGDOM OF SAUDI ARABIA Article 13: If a certified public accountant who practices the profession through a private office ceases to practice or is suspended from practicing the profession temporarily or permanently, and this cessation or suspension causes harm to clients or third parties, SOCPA may take any of the following actions: 1. Make a list of the pending operations and the rights and obligations upon the office. 2. Appoint a certified public accountant licensed to practice the profession to handle and settle the operations existing on the date of cessation or suspension, employees' rights, obligations and any other rights. 3. Determine the financial compensation payable to SOCPA and the certified accountant appointed for this work. Article 14: 1. SOCPA shall prepare specific programs to impose obligatory corrective measures against the offending certified public accountant in accordance with Article (16) of the Law, and it shall assess his progress therein. 2. The offending certified public accountant shall pay the financial compensation - specified by SOCPA - in return for taking the corrective measures imposed on him. Article 15: These Regulations shall be published in the Official Gazette and shall enter into force on the date the Law becomes effective. +966 11 294 4444 | Riyadh 11162 لارياض Kingdom of Saudi Arabia | المملكه العربيه السعوديه @ SaudiMCI www.mci.gov.sa 4