Setting up a business in Saudi Arabia implies completing various steps and procedures before and after you incorporate the company. As a result, one of the most important aspects is accounting when operating in this country. This is because there are specific regulations that companies must respect no matter the size of an enterprise. For this reason, finding professional accountants in Saudi Arabia must be one of your main priorities.
In this article, you will learn everything you need to know about accountants in Saudi Arabia. In case you intend to start your business in this country, our Saudi accountants are at the service of those who need assistance in financial matters. Let us see:
- What is an accountant?
- Why accountants are important for your company in Saudi Arabia?
- What are some of the main functions of an accountant?
- Responsibilities of accountants when exercising their profession
- What are some of the challenges accountants must face during these times?
- How can Company Formation Saudi help you get more information about Accountants in Saudi Arabia?
1. What is an accountant?
An accountant is an individual in charge of recording several financial statements of a company. Consequently, this activity involves taking note of the acquisition of rights, obligations, goods, etc.
Likewise, accountants are experts in this technique, making with their signature the financial statements of the company before the treasury. This means that keeping the accounts of companies, will work largely as a guarantor of good faith. In the same way, it will record all the data.
Thus, they will reach an evaluation of the patrimonial state of the company. This way, having an important reference to determine its value. Likewise, the accountant uses the entire accounting tradition, which has an enormous number of years between us. With it, it is possible to have a series of procedures and rules for making records of a company’s operations.
If they are false, there will be various ways of sanctioning them. For instance, the authorities can accuse them due to poor performance. In this sense, the role of an accountant implies a great responsibility.
1.1 History
We can trace the art of recording financial information back to ancient times. However, the principles that govern the accounting process have their origin approximately in the fifteenth century. One of the best-known procedures is the double-entry procedure. This criterion implies that two established operations must always be in balance. In addition, they must record those various ones properly.
This interest in the development of a technique that allows the efficient recording of commercial operations arose precisely in a context of abundance. Therefore, commerce had a role of enormous importance. Over time, the technique was refined and adapted to new scenarios.
2. Why accountants are important for your company in Saudi Arabia?
Besides the mandatory procedure that requires the presence of Saudi accountants, this role is key in terms of decision-making. Indeed, the accountant can provide information about what are the best opportunities to limit the taxes the company must pay. Consequently, knowing some of the twists and turns of each legislation and avoiding considerable operating costs.
For this reason, it is always advisable to have the advice of a good trustworthy accountant who can offer clarity on tax matters, which is generally cumbersome. Likewise, we are clear that accounting generates the reliable and necessary information for making financial, strategic, and control decisions.
Precisely, this reliable information is what we need in the current uncertainty, which prevents us from seeing what is coming. However, the pandemic is an unprecedented event, whose long-term consequences are not predictable.
In this scenario, the importance of accounting is critical, because it provides us with the certainty we need to restructure budgets and define financial, fiscal, and tax strategies.
2.1 Key role
Having an accountant is a key factor for a company to be successful. Through good accounting, you can measure the results of the strategies that are being implemented. In addition, it allows compliance with all the tax regulations that are requirements of a business.
Accounting provides information that supports the decision-making process in the business related to planning, making the company’s processes more efficient. For this reason, it is vital to have order and control. Additionally, it comes along with the services of a professional who organizes the financial aspects of the business operationally speaking.
An accountant is essential because financial activity undergoes innumerable and complex changes. Consequently, it is important for the collaboration of a person who has knowledge in the matter and who is constantly updated.
3. What are some of the main functions of an accountant?
As we mentioned above, an accountant is a person with sufficient technical knowledge to structure the most appropriate operations. Additionally, processing a system that may be able to provide reliable financial information and thus make the best decisions. The accountant goes further and his functions focus on making decisions that allow companies to generate financial value.
- Some functions that correspond to an external public accountant when hired to provide their services may be:
- Fill out and keep updated the accounting books (auxiliary, daily, ledger and balances, inventories).
- Keep accounting information up to date with all supports through typing in accounting software.
- Prepare the financial statements with their notes. This includes the frequency agreed in the contract, at least once a year by the requirements of the accounting regulations.
- Certify general-purpose financial statements.
- Prepare reports for the management, board of directors, board of directors, or other similar bodies with the frequency agreed between the parties.
- Prepare national and territorial tax returns with the respectively related annexes.
- Preparation of exogenous information destined for the tax authorities.
A false makeup accounting can bring serious legal problems to the company and its legal representative. Likewise, false accounting is the first step to the failure of a business. Hence, the importance of having an accountant who keeps everything correct and transparent, which leads us to the next point.
4. Responsibilities of accountants when exercising their profession
Some obligations and penalties that incur assuming a professional commitment. This is due to irresponsibility, ignorance, negligence, or simply not having carried out a risk assessment. Hence, responsibility is the obligation to assume a commitment and act correctly, especially responding to the fact or circumstances. The main responsibility of the public accountant is to certify that each assertion in the financial statement is satisfied.
The compilation rule clarifies that the books must be up to date with each accounting movement. One way is that the entity would have its financial information free of material inaccuracies corresponding to fraud or error. Therefore, this is through an internal financial audit, where they could estimate the value of the deviations. In addition, if these have been unintentional they could reach to adjust or correct.
Accountants in Saudi Arabia must maintain their professional skepticism and objectivity about financial information. For this, the business must be very well known and have evidence of the accounting movements. As a result, this will be what ultimately makes those assertions, which it certifies to be true. This way, specifying that these are occurrence, integrity, accuracy, court, and classification. Additionally, these ultimately must respond to the tests made by the auditors.
5. What are some of the challenges accountants must face during these times?
Times change in the same way that the skills required by professionals change. Consequently, the economic situation, technological evolution, and the consequences of the COVID-19 pandemic are key factors that will condition reinventing the accounting profession.
As a result, it marked difficulties for all companies regardless of their size. This represents multiple challenges that appeared for accountants and their work teams.
5.1 Telecommuting
Without a doubt, telecommuting is one of the new protagonists in the economy. It had to be imposed in most companies without any preparation. Indeed, it surprised entrepreneurs who had to invest money and time to implement it without affecting their productivity.
Companies or even independent accountants have found an invaluable ally in accounting management software in the cloud. Thus, this acquisition becomes essential for work, it does not only allows having all the information of the company. In addition, it allows you to answer your questions or generate reports from anywhere, 24/7, and in real-time.
This type of work involves efficient communication between everyone involved in a process. This may sound very easy, but let us be realistic, communication is one of the main problems in any company. Therefore, an accountant does not matter if he or she is an in-house employee or freelance in a company, they constantly require information from different departments. Additionally, it is probably a flow that requires the participation of many people.
Now, if you are an independent accountant, management software for accountants will allow you to coordinate your accounting team through permissions and roles. Plus, the possibility of working simultaneously without having to be in the same place. Do not worry, once this way of working is optimized, the advantages are many, among them, the opportunity to attract talent and new clients without geolocation barriers. The reinvention of accounting work is in remote work.
5.2 Digital government requirements
Currently, a public accountant to be competitive must successfully adapt to digital. Indeed, the pandemic with mobility restrictions, and teleworking, added to the government environment that is undergoing significant changes with new requirements. For instance, electronic invoicing and now in 2022 electronic payroll providing, are elements that must be understood and applied quickly by professionals in the accounting world.
Training is essential to take advantage of all the opportunities that digital transformation offers and not remain in the past. Nowadays, technology providers are a source of information and training, with them, it is possible to stay updated.
5.3 Master new technologies and software
With the previous point, the ability to dominate the systems and software that the company acquires will be essential. Companies worldwide are undergoing an unstoppable digital transformation in which they seek to optimize and systematize all processes through new technologies. As we have already mentioned, accounting is not exempt from this change: accountants must learn to handle different applications, such as CRM and other systems and technologies.
The most required accountants in Saudi Arabia will be those who have become friends with new technologies. Hence, the use of tools such as accounting systems, payroll software, comprehensive administrative software (ERP), etc. will be key. Indeed, it will give the accountant the potential to stop doing repetitive tasks or being a data logger or data entry clerk to take on a strategic and influential role in the business.
5.4 Uncertainty management
The recent crisis experienced has revealed the reality of all the challenges that this type of complex situation implies for companies. As a result, uncertainty will now be a constant that will accompany us in the new reality.
Accountants in Saudi Arabia will be continually required to have innovative thinking to provide creative solutions to problems never experienced before. Liquidity problems, indebtedness, closing of branches, drop in sales, legislative changes, and remote management are just some of them.
The role of the accounting department is to anticipate, and design policies and strategies to overcome any crisis. Plus, having a global vision of the current situation to analyze performance and better use of resources.
The accounting professionals should have more time to deal with things that impact and less of the administrative and operational tasks. They usually spend all their time in those activities. Thus, automating their processes in an integrated technological solution will allow them to generate reports instantly to give a timely response to these requirements will be key in this new role.
6. How can Company Formation Saudi help you get more information about Accountants in Saudi Arabia?
As you could see, accounting allows for managing the financial life of a company. This way, it gives a clear and precise order of the activities, resources, expenses, and income that make the organization work. Luckily, on Company Formation Saudi, you count on professional accountants in Saudi Arabia with years of experience in the field. In this manner, it will be much easy for you to set up your business in Saudi Arabia, hence, do not hesitate to contact us.
On the other hand, in case you need other types of services for your company in Saudi Arabia, we have several options at your disposal, such as:
- Company formation services.
- Branch services.
- Immigration process.
- Visa.
- Legal services.
- Virtual office services.
Do you need additional information about accountants in Saudi Arabia for your company? As we mentioned above, Company Formation Saudi provides an array of services to alleviate any burden. Please contact us at our phone number if you need help +971 43 316 688. Additionally, you can do it by email too at contact@companyformationsaudi.com.
In case you want to work with us, you can send your CV through thetalentpoint.com. In this way, we will locate a job opportunity that is consistent with your profile and needs. In turn, you can send us your CV to the following email address contact@thetalentpoint.com, and we will follow up on your application.