FCA asks firms to delay publication of preliminary results
The Financial Conduct Authority (FCA) has asked companies due to produce preliminary financial statements in the next few days to delay publication due to disruptions caused by the coronavirus.
The watchdog urged all listed companies to observe a moratorium on the publication of preliminary financial statements for at least two weeks.
“The unprecedented events of the last couple of weeks mean that the basis on which companies are reporting and planning is changing rapidly,” the FCA said in a statement.
FCA requests a delay to the forthcoming announcement of preliminary financial accounts https://t.co/5OTy0G5o33#FCAupdate
— Financial Conduct Authority (@TheFCA) March 21, 2020
“It is important that due consideration is given by companies to these events in preparing their disclosures. Observing timetables set before this crisis arose may not give companies the necessary time to do this.
“In addition, listed companies and the audit profession are facing unprecedented practical challenges during the coronavirus crisis.
“The FCA believes the practice of issuing preliminary financial statements in advance of the full audited financial statements is adding unnecessarily to the pressure on companies and the audit profession at this moment.”
Financial markets have faced major turmoil in the wake of the virus crisis, with the FTSE 100 index – which contains the biggest 100 companies on the London stock exchange – losing more than 28% of its value since February 21.
The FCA said while the practice of issuing preliminary financial statements was common among UK-listed companies, it was not required by either the Listing Rules or the Transparency Directive.
Rather, companies must publish full audited financial statements within four months of the end of the financial year.
The FCA also said it was in talks with the Financial Reporting Council and the PRA about possible measures aimed at ensuring companies take the necessary time “in these uncertain times to prepare appropriate disclosures and address current practical challenges”.
It said the three bodies intended to announce details soon.
The Authority also reminded companies the Market Abuse Regulation remains in full force, with listed firms still required to announce inside information to the market “as soon as possible unless a valid reason to delay disclosure under the regulation exists”.
