Coronavirus: FCA urges companies to delay publication of preliminary results
The City watchdog today urged listed companies to suspend the publication of their interim results for at least two weeks.
The Financial Conduct Authority (FCA) said: “The unprecedented events of the last couple of weeks mean that the basis on which companies are reporting and planning is changing rapidly.”
It said companies needed to give due consideration to the impact of coronavirus on their results and said: “Observing timetables set before this crisis arose may not give companies the necessary time to do this.”
The FCA also said that listed companies and auditors are facing unprecedented practical challenges during the coronavirus crisis.
The FCA said issuing preliminary figures in advance of audited financial statements was “adding unnecessarily to the pressure on companies and the audit profession at this moment”.
The watchdog said issuing preliminary statements is not required by the listing rules or the transparency directive.
The FCA said it was in talks with audit regulator the Financial Reporting Council (FRC) and the Bank of England’s Prudential Regulation Authority about a package of measures aimed at ensuring companies take the time to prepare appropriate disclosures and address practical challenges.
The FRC last week said companies should delay their financial reports rather than risking substandard audits.
The watchdog also called for auditors to be explicit in spelling out the risks posed to companies by the pandemic in their assessment of going concern and in annual reports.
The FCA also yesterday said that firms should think carefully about which of its staff it designated key workers.
Children of key workers can continue to be looked after by their schools which officially closed on Friday.
The FCA said a key financial worker at a regulated entity “fulfils a role which is necessary for the firm to continue to provide essential daily financial services to consumers, or to ensure the continued functioning of markets”.
The watchdog said: “We only expect a limited number of people to be identified as being key financial workers.”
The types of people the FCA said could be designated as key workers include individuals essential to the management of the firm, individuals essential in running online services and processing, individuals essential in the operation of trading venues and essential support workers such as finance and IT staff.