The International Accounting Standards Board (IASB) intends to achieve the vision of one global accounting standard. Adhering to this, the Saudi Organization for Certified Public Accountants (SOCPA), which is the key Authority for issuing Accounting and Auditing standards in the KSA, decided to form a committee and requested it to submit it’s recommendation with respect to convergence of Saudi standards with International Standards. In 2016, SOCPA concluded and announced the implementation of IFRS to all listed and unlisted companies.
In an era of globalization of businesses and markets, financial information prepared and audited according to national Generally Accepted Accounting Principles (GAAP) does not meet the requirements of users whose decisions are more international in scope. Therefore, the adoption of IFRS is a critical step towards increasing direct foreign investments in the Kingdom and enhancing the quality, transparency and comparability of its companies’ financial information.