The Financial Reporting Council has updated its guidance for corporate reporting to now include advice on half-year results and statements
The Financial Reporting Council (FRC) says that directors will need to exercise judgment about the nature and extent of the procedures that they apply to assess the going concern assumption at the half‐yearly date. This might include disclosures of:
Issues which might trigger a need to re‐examine the going concern assumption and going concern and liquidity risk disclosures include:
If going concern has become a significant issue since the previous annual financial statements, directors should undertake procedures similar to those that they would have carried out for annual financial statements to ensure that all relevant issues have been identified and considered.
It is a matter for a company to decide whether to engage their auditors to perform an interim review engagement – it is not a legal or regulatory requirement. However, feedback we have received from investors indicates that such a review provides valuable assurance, and this may be particularly so in the current environment.
Further details of the full guidance issued by the FRC can be found at Company Guidance (Updated May 2020) (Covid-19).