The Authority Clarifies the Appropriate Financial Reporting Framework for Non-Profit Companies

الهيئة توضح إطار التقرير المالي المناسب للشركات غير الربحية

The Saudi Organization for Chartered and Professional Accountants, through its Accounting Standards Board, clarified that non-profit companies established under the Companies Law are subject to the same accounting provisions as for-profit companies, differing mainly in how profits are disposed of. It stated the appropriate framework for such companies is IFRS for SMEs (or full IFRS if the company chooses), that donations designated to the company's own spending channels follow the government grants accounting standard, and that donations restricted to a specific channel are treated as off-balance-sheet transactions with the company acting as agent for the donor. The opinion also sets out required disclosures on donations, profits spent on non-profit purposes, and donations managed on donors' behalf.

Original PDF ↗

See all from SOCPA →