Article 27 of the Saudi Finance Companies Control Law
المادة 27 من نظام مراقبة شركات التمويل
The article requires a finance company to appoint one or more licensed external auditors, and allows SAMA to appoint another auditor at the company's expense in the cases the Regulations specify.
Official text (Arabic)
This article has not been amended since the law was issued.
يجب على شركة التمويل تعيين مراجع حسابات خارجي مرخص أو أكثر، ويجوز للمؤسسة تعيين مراجع حسابات آخر على نفقة شركة التمويل في الأحوال التي تحددها اللائحة.
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 27 explained in plain English
This article regulates the audit of a finance company's accounts by an external party, and has two provisions:
- A duty on the company: it must appoint one or more licensed external auditors.
- A power for SAMA: SAMA may appoint another auditor at the finance company's expense, in the cases the Regulations specify.
The rule is that the company chooses its external auditor, but SAMA may add another auditor in certain cases that the article did not mention but referred to the Regulations, and the company bears the cost.
It is preceded by Article 26 on SAMA's approval to open and close branches. It is followed by Article 28, which requires the company to supply SAMA with the data it requests, requires SAMA to examine the company's records and accounts periodically, and treats the company's refusal to provide what the examination requires as a violation. So the external audit and the periodic examination complement each other.
Companies that need to understand their audit obligations can consult a lawyer who specializes in banking and finance.
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 27 of the Saudi Finance Companies Control Law
Must a finance company appoint an auditor?
Yes. It must appoint one or more licensed external auditors.
Is SAMA entitled to appoint an auditor for a finance company?
SAMA may appoint another auditor at the finance company's expense in the cases the Regulations specify.
Who bears the cost of the auditor SAMA appoints?
The finance company, as the article provides that the appointment is at its expense.
More articles on Supervising Finance Companies
- Article 21
The article provides that the Saudi Arabian Monetary Agency supervises the work of finance companies and exercises its powers under the Law and its Regulations.
تشرف المؤسسة على أعمال شركات التمويل، وتمارس صلاحياتها بموجب أحكام هذا النظام ولائحته.
- Article 28
The article requires a finance company to supply SAMA with the data it requests, requires SAMA to examine its records and accounts periodically, and treats refusing to provide what the examination requires as a violation.
تزوِّد شركة التمويل المؤسسة بالبيانات التي تطلبها، وعلى المؤسسة فحص سجلات شركة التمويل وحساباتها بشكل دوري، ويعد امتناع الشركة عن تقديم ما يتطلبه هذا الفحص مخال
- Article 32
The article allows the Governor to appoint qualified employees with law-enforcement status for inspection, oversight, investigation of violations and public prosecution before the competent court, and refers their procedures to the regulations.
يعين المحافظ موظفين مؤهلين لهم صفة الضبط؛ للقيام بما يأتي: 1- أعمال الفحص والرقابة. 2- التحقيق في مخالفات أحكام هذا النظام. 3- الادعاء العام أمام المحكمة المختص
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.