The review analysed a sample of March 2020 interim and annual reports and accounts and found that although companies provided sufficient information to enable a user to understand the impact COVID-19 had on their performance, position and future prospects, some - particularly interim reports - would have benefited from more extensive disclosure.

The FRC reminds companies that they should:   

• explain the significant judgements and estimates made in preparing their accounts and provide meaningful sensitivity analysis or details of a range of possible outcomes to support any disclosed estimation uncertainty;
• describe any significant judgements made in determining whether there is a material uncertainty about their ability to continue as a going concern;
• ensure that assumptions used in determining whether the company is a going concern are compatible with assumptions used in other areas of the financial statements;
• apply the requirements of IAS 1 to any exceptional or similar items, with income statement sub-totals comprising only items recognised and measured in accordance with IFRS;
• apply existing accounting policies for exceptional and other similar items to COVID-19 related income and expenditure consistently and should not split income and expenses between COVID-19 and non-COVID-19 financial statement captions arbitrarily; and
• prepare interim reports that provide sufficient information to explain the impact that COVID-19 has had on their performance, position and future prospects.

Please click to access the thematic review on the FRC website.