Article 3 of the Saudi Commercial Books Law
المادة 3 من نظام الدفاتر التجارية
The article sets out what is entered in the original journal and how: financial operations day by day and personal withdrawals monthly, with auxiliary journals allowed but treated as original if their totals are not carried over.
Official text (Arabic)
This article has not been amended since the law was issued.
تقيد في دفتر اليومية الأصلي جميع العمليات المالية التي يقوم بها التاجر وكذلك مسحوباته الشخصية، ويتم هذا القيد يومًا بيوم بالتفصيل باستثناء المسحوبات الشخصية التي يمكن أن تقيد إجمالا شهرًا بشهر، ويجوز للتاجر أن يستعمل دفاتر يومية مساعدة لإثبات تفاصيل الأنواع المختلفة من العمليات المالية، ويكتفي في هذه الحالة بتقييد إجمالي لهذه العمليات في دفتر اليومية الأصلي في فترات منتظمة من واقع هذه الدفاتر، فإذا لم يتبع هذا الإجراء اعتبر كل دفتر مساعد دفترًا أصليًّا.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 3 explained in plain English
This article explains the content of the original journal, one of the three books that Article 1 requires as a minimum.
What is entered in it?
- All financial operations carried out by the merchant.
- Their personal withdrawals, meaning what they take for themselves from the trade's funds.
How is the entry made?
- Financial operations are entered day by day and in detail.
- Personal withdrawals may be entered as a total, month by month, instead of by detailed daily entry.
Auxiliary journals: a merchant may use auxiliary journals to record the details of the different types of operations, for example by dedicating one book to sales and another to purchases. In that case it is enough for them to enter in the original journal the total of these operations at regular intervals, based on the auxiliary books.
The consequence of not carrying totals over: if the merchant does not follow this procedure, meaning they do not transfer the totals to the original journal at regular intervals, each auxiliary book is treated as an original book, and is subject to what original books are subject to.
Under Article 2, these data may be recorded by computer by establishments and companies that use it for their accounts. The details of goods at year end belong in the inventory book, as in Article 4.
To find out the most suitable way to organize the books of your business, you can consult an accountant or a lawyer specializing in commercial and company cases.
Practical example
Abdullah owns a clothing shop in Riyadh and uses an auxiliary book for daily sales. It is enough for him to transfer the total of sales to the original journal at regular intervals, such as weekly. He enters what he withdraws for his household expenses as a total each month. If he neglects to transfer the totals regularly, the auxiliary sales book is treated as an original book.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 3 of the Saudi Commercial Books Law
Must operations be entered in the journal every day?
Yes. Financial operations are entered day by day in detail, except personal withdrawals, which may be entered as a total each month.
May auxiliary journals be used?
Yes, and it is then enough to enter the total of their operations in the original journal at regular intervals.
What happens if the merchant does not carry over the totals of the auxiliary books?
Each auxiliary book is treated as an original book.
More articles on Journal, Inventory and Ledger
- Article 1
The article requires every merchant to keep regular commercial books in Arabic that show their financial position, at least the original journal, the inventory book and the general ledger, and exempts a merchant whose capital does not exceed SAR 100,000.
يجب على كل تاجر أن يمسك الدفاتر التجارية التي تستلزمها طبيعة تجارته وأهميتها بطريقة تكفل بيان مركزه المالي بدقة، وبيان ما له من حقوق وما عليه من التزامات متعلقة
- Article 4
The article explains that the inventory book records the details of goods held at the end of the financial year, or a summary of them, and a copy of the annual statement of financial position if not recorded in another book.
تقيد في دفتر الجرد تفاصيل البضاعة الموجودة لدى التاجر في آخر سنته المالية، أو بيان إجمالي عنها إذا كانت تفاصيلها واردة بدفاتر أو قوائم مستقلة، وفي هذه الحالة تع
- Article 5
The article requires financial operations of the same nature to be carried over from the journal to the general ledger so that the result of each account can easily be drawn out separately at any time.
ترحل إلى دفتر الأستاذ العام العمليات المالية ذات الطبيعة الواحدة من دفتر اليومية بحيث يمكن استخلاص نتيجة كل حساب على حدة بسهولة في أي وقت.
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.