What is Accounting Period?
An accounting period is the defined time interval over which a business’s financial transactions are recorded, summarized, and reported, ranging from one month for internal management reporting to one full year for statutory and tax filings.
How It Works
- Calendar year: 1 January to 31 December (most common in Saudi Arabia).
- Fiscal year: any 12-month period chosen by management, subject to ZATCA approval.
- Interim periods: quarterly for listed companies (CMA disclosure).
- First and final periods can be shorter or longer than 12 months.
Saudi Context
Most Saudi companies follow the calendar year for both their financial year and ZATCA tax/zakat year. CMA-listed companies file quarterly interim financials in addition to audited annuals. Changing the accounting period requires both ZATCA notification and approval, and the transitional period statements must be clearly disclosed.
Example
A Saudi LLC sets its accounting period as 1 January to 31 December. Its 2026 financial statements cover all transactions from 1 January 2026 to 31 December 2026 and are filed with ZATCA within 120 days of year-end.