Construction Accounting & Advisory Saudi Arabia

Construction Sector

Construction Financial Compliance in Saudi Arabia

Our Construction sector clients include general contractors, MEP specialists, fit-out companies, infrastructure developers, and giga-project suppliers. These businesses require financial advisors who understand not just general accounting standards, but the specific ZATCA treatment, sector regulatory requirements, and Vision 2030 compliance obligations that apply to their industry.

Construction is Saudi Arabia's second-largest non-oil sector — and the primary beneficiary of Vision 2030's SAR 7 trillion infrastructure investment programme. But the accounting complexity of construction is often underestimated by new entrants:

• IFRS 15 revenue recognition: Construction contracts are generally recognised over time under IFRS 15 — but the specific measure of progress (input method vs output method), cost-to-complete estimates, and loss contract provisions require careful judgement. Incorrect revenue recognition is the number one audit finding in Saudi construction companies.
• Retention accounting: Saudi construction contracts typically include 5–10% retention withheld until practical completion. Both client-side deductions and back-to-back subcontractor retentions must be tracked separately and released accurately.
• Saudization in construction: Construction has specific Nitaqat Saudi employment ratios that are actively enforced. Many contractors manage large, mobile workforces across multiple projects — making accurate Saudization tracking a genuine operational challenge.
• WPS complexity: Construction workers are often paid daily or weekly rates, have variable overtime, and receive allowances that affect WPS calculations differently from salaried employees. Errors attract immediate government service suspension.