Saudi CMA proposes a dedicated performance discussion in annual board reports

Saudi Arabia’s Capital Market Authority has opened a consultation on a dedicated financial and operational discussion in listed companies’ annual board reports. Responses close on 20 November.[1]

The proposal combines existing disclosures with analysis of liquidity, capital resources and material changes against the previous year. Relevant financial and non-financial indicators would support the discussion, alongside trends and uncertainties affecting future performance.[1]

Existing reports already carry financial comparisons

Article 87 of the Corporate Governance Regulations already requires a five-year summary of assets, liabilities and results, or a shorter history since incorporation. It also covers business activities, major plans, risks and material differences in operating results. Those disclosures provide an existing base for company analysis.[2]

The CMA’s current FAQ interprets material operating-result differences as increases or decreases of at least 10% against prior-year results or announced expectations. Companies may also include smaller differences. That threshold identifies changes for disclosure; it does not explain which business activity caused them.[3]

For analysts and brokers, the proposed section would bring the causes of performance changes together with measures of operating efficiency and financial capacity.[1]

Main Market compliance would begin with the first board report after approval. Parallel Market application would initially be indicative, becoming mandatory with the first annual board report issued in the year after approval.[1]

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