The Saudi Commercial Books Law: Three Mandatory Books Above SAR 100,000 of Capital, Kept in Arabic for Ten Years

The Saudi rule on which books a merchant must keep is sixteen articles long and dates from 1409H (1989). As of October 2026 the Bureau of Experts portal lists the Commercial Books Law, Royal Decree M/61 of 17/12/1409H, as in force, with none of its articles marked amended. Candidates search for "the new Commercial Books Law"; the portal shows no replacement. What has moved is the law around it: the Evidence Law of 1443H now sets how far a court trusts the books.

The core fits in one line: capital above SAR 100,000, three books in Arabic, ten years. The six-year figure some pages give for Saudi books matches the VAT rule, counted from the end of each tax period. The Commercial Books Law says ten.

Who must keep books: the SAR 100,000 capital line

Article 1 requires every merchant to keep the books the nature and importance of the business require, regular and in Arabic, so that they show the financial position accurately, and names three as the minimum. The same article exempts from "these books" a merchant whose capital does not exceed SAR 100,000. The test is capital, not turnover, and the words are "does not exceed": exactly SAR 100,000 is exempt, one riyal more is not.

The implementing regulation, Ministerial Resolution 699 of 29/7/1410H, is published by the Ministry of Commerce, not on the Bureau of Experts portal. Its Article 1 treats as a merchant the individual trader and a company whose main purpose is commercial business.

The exemption belongs to this Law alone. Article 58 of the Income Tax Law requires every taxpayer, except a non-resident with no permanent establishment, to keep books and records in Arabic, with no capital threshold. For zakat, a payer with no financial statements reflecting its activity and no obligation to issue them is assessed on an estimated base (1445H Zakat Collection Regulations, Articles 1 and 89); the accounts-based route is in How the Zakat Base Is Calculated in Saudi Arabia.

The three mandatory books and what each one records

Book	What goes in it	Article
Original journal (دفتر اليومية الأصلي)	Every financial transaction, day by day and in detail, and the merchant's personal drawings, which may be entered in total month by month	3
Auxiliary journals (optional)	Details of particular kinds of transaction, with totals posted to the original journal at regular intervals; without those postings each one counts as an original journal	3
Inventory book (دفتر الجرد)	The goods on hand at the end of the financial year, in detail or in total where separate lists hold the detail, and a copy of each year's statement of financial position unless it is entered in another book	4
General ledger (الدفتر الأستاذ العام)	Transactions of the same nature posted from the journal, so each account's result can be extracted at any time	5
Correspondence and documents	True copies of everything sent and received about the business, filed so that entries can be checked and profit or loss verified	6

Two traps. The inventory book carries the statement of financial position, and the Law names no income statement. And the auxiliary journal is optional on a condition: skip the periodic totals and every subsidiary day book becomes an original journal.

Arabic, numbered pages, the Ministry's form and computer records

Article 7 requires the books to follow the Ministry of Commerce's form, with numbered pages. The regulation adds the formal rules in its Articles 4, 6 and 7. Before use, every page is numbered and the local chamber of commerce signs and stamps the first and last pages. No blank spaces, margin notes, scraping out or squeezing in; an error is corrected by a further entry on the date it is found. A new book opens only when the old one is full and its last page is signed by a licensed chartered accountant or the chamber.

Article 2 of the Law lets establishments and companies that keep their accounts on computer record the books that way, on conditions the regulation sets. Its Article 3, as amended by Ministerial Resolution 1110 of 24/12/1410H, lists six.

Condition	What it requires
Inspection	The data can be inspected at any time
Printed outputs	Regular (weekly, monthly, quarterly), in Arabic, dated, page-numbered and complete, so each item traces to its input
Support	A written document behind every item, or a written explanation where it was keyed in directly
Reproduction	Outputs can be produced again at any time
Documentation	The input system, any in-house software, operating instructions and operators' duties
Security	Adequate safeguards and controls against tampering, open to examination

The establishment answers for what the system records, and its auditor must issue an assurance report supporting management's assertion that the data were recorded as required and that the financial statements agree with the system's reports. Many Saudi companies need no auditor, as Which Saudi Companies Must Appoint an Auditor, and How Long One May Serve explains.

Ten years: the books, the correspondence and the documents

Article 8 binds the merchant and his heirs to keep the books, correspondence and documents for at least ten years, without saying when the period starts. Other laws set their own periods, counted from other events.

Rule	What it covers	Period	Counted from
Commercial Books Law, Article 8	Books, correspondence, documents	At least 10 years	Not stated
Law of the Profession of Accounting and Auditing, Article 7	The auditor's working papers, reports and financial statements	At least 10 years	The report on each audited year
VAT Implementing Regulations, Article 66	Invoices, books, records, accounting documents	At least 6 years	The end of the tax period
VAT Implementing Regulations, Article 66	Capital asset records	The Article 52 adjustment period (6 years movable, 10 immovable, or a shorter accounting life) plus 5	Acquisition

The periods run side by side, so a record covered by two is kept for the longer, and VAT records of immovable capital assets outlast the ten years: ZATCA's records guideline keeps real estate records for at least 15 years in all cases, citing the GCC Unified VAT Agreement.

Books as evidence: the presumption and the refusal to produce

Article 9 presumes every entry was made with the merchant's knowledge and consent unless the contrary is proved, so a merchant disowning his staff's entry carries the burden. Article 10 lets the competent judicial body order the books produced, on its own motion or a party's request, and treat a refusal as a presumption that the facts they were to prove are true.

The Evidence Law, Royal Decree M/43 of 26/5/1443H, in force 180 days after its publication on 7 January 2022, sets their weight in Article 31.

Situation	Rule
Books against a non-merchant	Not evidence, though the court may then put the supplementary oath to the stronger party where witness proof is allowed
Regular mandatory books against an opposing merchant	Evidence for the owner, rebuttable by any means, including the opponent's regular books
Mandatory books, regular or not, relied on by the other side	Evidence against the owner, and the entries in his favour count for him too
In a dispute between two merchants, unjustified refusal to produce books the opponent relied on and accepted in advance	The court may put the supplementary oath to the party relying on them

The lesson is in rows two and three: regular books can win their owner a case; irregular ones he cannot invoke himself, and they count only when the other side relies on them. The two laws treat a refusal differently, a presumption in the 1409H Law and an oath in the Evidence Law, which repeals whatever conflicts with it (Article 128); the portal still shows Article 10 unamended.

Penalties: SAR 5,000 to 50,000 for each violation

Article 12 fines each violation of the Law, its regulation or the decisions issued under it at least SAR 5,000 and at most SAR 50,000, the only penalty the Law sets, and Article 13 has the Board of Grievances impose it. That wording predates today's commercial courts: the Commercial Courts Law, Royal Decree M/93 of 15/8/1441H, gives the commercial court claims and violations under "other commercial laws" (Article 16), but the Books Law's text is unchanged and the portal does not say which body applies the fine today. On the exam, answer from the text. Article 14 repealed Articles 6 to 10 of the Commercial Court Law of 1350H, the earlier rules on books.

How the Laws paper asks about this law

Subject and main topic	Subtopic	Guidance framework tasks and skill level
Laws, main topic 3: Principles of commercial law (5% to 7%)	3/2 Commercial Books Law (topics document); 3/5 in the February 2026 framework	Function of books, mandatory and optional books; computer recording; probative value; penalties (Remembering and Understanding). Numbering, no erasure, prescribed form (Application)
Financial Accounting (secondary), main topic 1: conceptual framework and accounting cycle (5% to 15%)	1/2/2 Books and records; 1/11 in the framework	Types of books and records and recording under double entry (Application)

Laws is multiple choice only, 50 questions in two hours, and 5 to 7% is about three questions for the whole of main topic 3. Expect the capital line, the three books by name, monthly drawings, ten years for the merchant and his heirs, the two presumptions, the fine range and the Board of Grievances; likely distractors are turnover for capital, six years for ten, and an income statement among the books. The SOCPA Regulations Study Guide places this law in the rest of the paper.

Where to practise this

Thresholds, periods and named books are recall facts. Prepito's Regulations course covers the commercial laws on the paper with practice questions and explanations in Arabic and English, and the Financial Accounting course covers the accounting cycle with practice questions and timed simulations. For the qualification as a whole, see the SOCPA Fellowship programme.

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Sources: Commercial Books Law (Bureau of Experts), Ministry of Commerce, the Law and its Implementing Regulation, Evidence Law, Commercial Courts Law, Law of the Profession of Accounting and Auditing, Income Tax Law, ZATCA, VAT Implementing Regulations, ZATCA, Zakat Collection Regulations of 1445H, SOCPA Fellowship exam topics, SOCPA guidance framework, February 2026. A study guide, not legal advice: the Arabic text governs, and laws change, so confirm the current text on the Bureau of Experts portal before relying on a figure.