The Division continues to monitor how companies are disclosing the effects and risks of COVID-19 on their businesses, financial condition, and results of operations and is supplementing CF Disclosure Guidance Topic No. 9 with guidance regarding additional disclosure considerations. We continue to encourage companies to provide disclosures that allow investors to evaluate the current and expected impact of COVID-19 through the eyes of management and to proactively revise and update disclosures as facts and circumstances change. These disclosures should enable an investor to understand how management and the Board of Directors are analyzing the current and expected impact of COVID-19 on the company’s operations and financial condition, including liquidity and capital resources.

Resilient leadership: Propel toward recovery

As we progress through the Recovery phase of the crisis, resilient leaders recognize and reinforce critical shifts from a “today” to a “tomorrow” mindset for their teams. They perceive how major COVID-19-related market and societal shifts have caused substantial uncertainties that need to be navigated—and may be seized as an opportunity to grow and change.

Virtual and remote: Navigating the next financial close

As the COVID-19 pandemic forced workers to abandon their offices earlier this year, many finance leaders found themselves in a predicament: how to manage a period-end close with a distributed and distracted workforce. It was far from simple. Decentralization, involving collaboration across different systems and locations, suddenly became an organizing principle. Shortfalls, whether in staffing, IT infrastructure, or cybersecurity, quickly became visible.

FinOps: Keeping a lid on post-COVID cloud costs

In the rush to support business continuity and remote work, many organizations have ramped up their cloud usage—sometimes taking on more resources than they actually need. FinOps is one strategy that can help keep costs under control. The COVID-19 crisis has already transformed the business world in countless ways as many companies scramble to stay operational while moving much of their work online. Frequently, cloud technology is an essential means to both ends.

Experience brief: Rethink business with human-centered design

COVID-19 has triggered astonishingly swift and sweeping change to how people work, shop, socialize, relax, approach hygiene, and generally view the world. Which new behaviors and habits will persist, and what are the implications for the long-term viability of different business strategies? As organizations move forward with little precedent and considerably high stakes, human-centered design can provide much-needed structure and focus for assessing needs, testing and building solutions, and adapting business models to recover more quickly and thrive over the long term.

Under pressure – Leading in uncertain times

Just months ago, boards were contemplating what lay ahead for a new decade. The impact of changing community expectations, evolving technology and a growing climate threat were among the key topics being discussed. Those issues haven’t gone away, but they’ve been sidelined by a situation few people could have foreseen. The rapid spread of COVID-19 has affected every corner of the globe, with unprecedented measures being taken to protect people and reduce its severity. While public health is the top priority, economic and social considerations are close behind.

Coronavirus: 15 emerging themes for boards and executive teams

Recently, McKinsey spoke with a group of leading nonexecutive chairs and directors at companies around the world who serve on the McKinsey Resilience Advisory Council, a group of external advisers that acts as a sounding board and inspiration for our latest thinking on risk and resilience. They shared the personal insights and experiences gained from their organizations’ efforts to manage through the crisis and resume work. The 15 themes that emerged offer a guide to boards and executive teams everywhere.

It provides questions and points to consider as the board oversees risk management, operations, new legislation, financial reporting, technology, and cybersecurity.

Review the checklist on the AICPA's website and a summary on the Journal of Accountancy's website.

CAQ COVID-19 Resource: Key auditor and audit committee considerations

This resource is intended to provide high-level financial reporting considerations for auditors and audit committees as certain audits near completion, quarterly reviews are occurring, and during planning for 2020 audits. This resource is also, intended as general information and should not be relied upon as being definitive or all-inclusive. The CAQ encourages audit firms and audit committees to refer to the rules, standards, guidance, and other resources in their entirety.

Interim financial statements included in Form 10-Q: Auditor responsibilities and COVID-19 considerations for investors and audit committees

SEC Regulation S-X specifies that the interim financial statements included in Form 10-Q must be reviewed by an auditor in accordance with PCAOB standards. PCAOB Auditing Standard 4105, Reviews of Interim Financial Information establishes standards and provides guidance on the nature, timing, and extent of the procedures to be performed by an independent auditor when conducting a review of interim financial information. The general standards related to independence, training and proficiency and due professional care also apply to auditors conducting interim reviews.

COVID 19: Considerations for internal controls over financial reporting

The COVID-19 pandemic poses unique and novel challenges to publicly-traded retailers, particularly with respect to design and testing of both internal controls over financial reporting and disclosure controls and procedures. We recommend that retailers assess what has changed in the current financial reporting environment, consider whether existing controls are sufficient to prepare financial statements and disclosure documents at the reasonable assurance level, and determine what new controls (if any) are necessary to reduce the risk of errors and fraud.

Leveraging AI to battle this pandemic — And the next one

An alternative approach for policy makers to consider adding in their mix for battling Covid-19 is based on the technology of personalized prediction, which has transformed many industries over the last 20 years.  Using machine learning and artificial intelligence (AI) technology, data-driven firms (from “Big Tech” to financial services, travel, insurance, retail, and media) make personalized recommendations for what to buy, and practice personalized pricing, risk, credit, and the like using the data that they have amassed about their customers.

Reporting and fraud risk arising from COVID-19 pose significant challenges for professional accountants

Globally the COVID-19 crisis is causing huge financial implications for many organizations, as well as exposing them to a variety of other emerging risks related to virtual operations, cybersecurity, and changes in relationships with customers and suppliers that put pressure on operations and service delivery. This new environment creates a heightened risk of fraud and improper financial reporting, as new opportunities and pressures can arise for both internal employees and external parties.

Managing fraud risk, culture, and skepticism during COVID-19

This resource is intended to heighten awareness of the risk for fraud and misconduct that might occur inside an organization during, or as a result of, this crisis. Even if most people behave ethically, members of the financial reporting supply chain should review the controls, processes, and procedures that they have in their arsenals: a robust crisis and fraud risk management plan, a healthy dose of skepticism, and a strong culture of integrity.

Effective for annual reporting periods beginning on or after June 1, 2020, this is now in Part I of the CPA Canada Handbook – Accounting. Earlier application is permitted, including in financial statements not yet authorized for issue at May 28, 2020. The Amendments to the Basis for Conclusions that accompany, but are not part of, IFRS 16 Leases are also now in Part I of the CPA Canada Handbook – Accounting.

Review the announcement on the AcSB's website.

COVID-19 Checklist: 51 Issues for public company directors and officers to consider

The COVID-19 pandemic has grown into a health crisis with unique risks that are disrupting business operations and leaving public companies with many questions. While “known unknowns” need to be understood and managed, it is the “unknown unknowns” that need to be surfaced and considered.

We have set out 51 issues we have been addressing for Canadian public companies concerning the impact of COVID-19 on their financial results, operations and cash flows, as well as the price or value of their securities in public capital markets.

Fortune 500 GCs discuss how to be a strategic asset through the pandemic

As the country settles into the new routine of social distancing and working from home, and the pandemic begins to show early—if subtle—signs of subsiding, boards and management are beginning to shift their focus from responding to the crisis to reopening their physical plants amid continued safety concerns. This complex process is dependent on many variables, from worker safety to differing county and state standards for reopening.

Internal auditors prepare for the return to work post-coronavirus

Most internal audit leaders have been getting involved in preparations at their organizations for returning to the workplace, especially in assessing risks and consulting activities, according to a new survey, but relatively few are actually performing reviews of critical risk areas, such as health and safety.

5 things companies should do in tough times

Straight to the point, tough times call for tough measures. Or do they? It all depends on how you define tough measures and how appropriate they really are for the circumstances. As companies currently face a unique situation in modern history and are evaluating continued operations, balancing profits with acceptable levels of loss, functioning with massively more remote work and trying to make up for any economic disruptions, the first thought tends to be “How can we cut costs?”

Accountants can help companies set strategy to deal with coronavirus

Management accountants and CFOs can play an important role in guiding companies through the strategic options available to cope with the COVID-19 pandemic.

A recent Statement on Management Accounting report, “Strategic Analysis—Methods for Achieving Superior and Sustainable Performance,” discusses how management accountants and CFOs can lead strategic analysis and planning to improve the performance of their organizations for the long term, during and after the current pandemic eventually subsides.

Good leaders can overcome institutional inertia in a crisis

Although Covid-19 is clearly a catastrophe, it offers what every social scientist craves: a “natural experiment” that allows us to compare different responses to similar shocks. We have already learned much about what does and doesn’t work in tackling the virus itself. We can also glean profound lessons about the role of leaders.

Your CEO succession plan can’t wait

“We really need to have a name in the envelope as soon as possible.” So begins many of the discussions we’ve been having lately with board members who are frantic about CEO succession planning. Given that the median age of S&P 500 CEOs is 58 — putting many executives at higher risk of Covid-19-related illness — it’s no wonder that inquiries we’ve received from companies around the world focus intensely on best practices in running a “quick” CEO succession process.

Challenges and opportunities in the post-COVID-19 world

While a global pandemic has been a looming risk for decades, COVID-19 has come as a shock to society, health systems, economies and governments worldwide. In the midst of extraordinary challenges and uncertainty, and countless personal tragedies, leaders are under pressure to make decisions on managing the immediate impact of the pandemic and its consequences, decisions that will shape the state of the world for years to come. What might be the silver linings in the crisis and how might leaders use this moment to build a more prosperous, equitable and sustainable world? 

COVID-19 risks outlook a preliminary mapping and its implications

As countries seek to recover, some of the more lasting economic, environmental, societal and technological challenges and opportunities are only beginning to become visible. While societies, governments and businesses collectively grapple with these possibilities, it is vital to anticipate the emerging risks generated by the repercussions from the pandemic.

Green Swan 2 – Climate change and Covid-19: reflections on efficiency versus resilience

Policymakers are increasingly concerned about climate-related risks as manifested in more frequent and more destructive weather catastrophes, causing significant losses to people, firms, banks and insurance companies, and hence posing a growing threat to financial stability. This is one reason why central banks and supervisors have put climate change on their agenda. In the last two years, 65 central banks and financial supervisors have joined the Network for Greening the Financial System (NGFS) (as of 16 April 2020). But climate risks have also caught the attention of society as a whole, as well as that of large investment firms and asset managers.

Cost of compliance: New decade, new challenges

Financial-services firms were already facing an inflexion point in regulatory compliance for 2020, even before the COVID-19 pandemic disrupted the industry worldwide, according to the 11th annual cost of compliance survey by Thomson Reuters Regulatory Intelligence.

Tightening of risk and compliance budgets, regulatory and cultural change and the possibility of increasing personal liability all provided evidence of a cyclical turn from the post-financial crisis years. It is too early to tell how the novel coronavirus will influence that inflexion over the long term, but already regulators are issuing a flurry of revisions to rules, and firms are asking for the postponement of various regulatory initiatives so they can focus on managing events.

From surviving to thriving: Reimagining the post-COVID-19 return

In this article, we suggest that in order to come back stronger, companies should reimagine their business model as they return to full speed. The moment is not to be lost: those who step up their game will be better off and far more ready to confront the challenges—and opportunities—of the next normal than those who do not.

There are four strategic areas to focus on: recovering revenue, rebuilding operations, rethinking the organization, and accelerating the adoption of digital solutions.

Review the article on the Harvard Business Review's website.

Impact of COVID-19 on the global financial system

As the human and economic costs of the COVID-19 pandemic have unfolded, the global financial system has been both a source of strength—with banks and fin-techs helping distribute support to small businesses and households in need—and an area of potential risk, with record levels of market volatility and growing concern around credit losses. Governments, central banks, regulators, and international organizations have moved rapidly to address the economic collapse and financial fallout, but questions remain around how policy should continue to evolve to preserve financial stability.

Energy Transition Index 2020: from crisis to rebound

The world’s energy transition has made slow and steady progress over the past five years, but the COVID-19 crisis risks derailing long-term progress. Will recovery and the shifting global energy order shape new opportunities for picking up the pace?

Winning the race for survival: How new manufacturing technologies are driving business-model innovation

As most manufacturing firms continue to realize their revenues through traditional channels, COVID-19 has created the need for rapid and radical innovation in both business and operating models. The future belongs to those who can manage uncertainty and innovate rapidly.

How the fourth industrial revolution can help us beat COVID-19

As global COVID-19 cases continue to rise, the unmatched connectivity that defines our era serves as both bane and blessing. Our interconnected livelihoods allow for the rapid spread of both disease and cure. The Fourth Industrial Revolution gives us the tools we need to battle this global threat. If we do not have the tools of tomorrow, we must have the leadership of today.

5 ways collective intelligence can help beat coronavirus in developing countries

The COVID-19 pandemic has so far had the greatest impact in developed economies with strong health systems. And the results have been terrifying. But the epicenter of the pandemic could soon shift again – to low and middle-income countries, including those already fragile after years of conflict. Many are woefully unprepared.

Emerging priorities and principles for managing the global economic impact of COVID-19

Governments and central banks in the economies most affected by the COVID-19 pandemic have rapidly mobilized to keep their economies on “life support” while societies fight the most dramatic health crisis of our time. Where is the economy heading in the current situation? How effective are the policy responses being deployed? What priorities and principles should guide actions by public and private sector leaders in response to the unfolding economic crisis?

Workforce principles for the COVID-19 pandemic: Stakeholder capitalism in a time of crisis

While there currently is a significant focus on the public health and economic impact of the COVID-19 pandemic, the workforce and societal implications are no less profound. The guiding principles and the four workforce management imperatives outlined in this document are a preliminary response to the unfolding crisis. They are intended to serve as a tool for Chief Human Resources Officers (CHROs) and other business leaders. While businesses may need to adjust measures according to different policy environments, the concept of stakeholder capitalism can provide a framework for a responsible course of action at this pivotal moment.

As the COVID-19 pandemic and its effects in Canada continue to evolve, the standard-setting boards have focused discussions on ensuring stakeholder needs are addressed. Recent decisions have focused on alleviating pressure as you navigate these challenging and uncertain times.

Review the statement on the AcSB’s website.