Late on Saturday 21 March 2020, the Financial Conduct Authority (FCA) wrote to companies that have published that their preliminary results announcement date is in the next two weeks, with a strong request to delay publication of their preliminary results. The FCA has since published a supporting technical Q&A on this voluntary moratorium.
The FCA highlights the importance of full consideration of the unprecedented events of the last few weeks, which may require more time than pre-crisis timetables might otherwise allow. It confirms that, although issuing preliminary financial statements is common market practice for UK listed companies, it is not in fact a requirement of the Listing Rules or the Transparency Directive. The FCA’s view is that companies and auditors are facing unnecessary pressure as a result.
In its covering announcement, the FCA reminds companies that the Market Abuse Regulation (MAR) remains in force and that it is critical to announce inside information to the market as soon as possible, where required under the regulation.
A company’s audited annual report in fact can be published up to 4 months after the period end. The principle underlying the FCA’s request is that, subject to meeting the requirements of MAR, it should be acceptable for companies to use the full time available to publish their reports.
The FRC published a statement on 23 March in support of the FCA’s request. It adds that listed companies and their auditors should consider carefully whether they should delay other corporate reports such as interim financial statements for the next two weeks, except where necessary to meet a legal or regulatory requirement.
The FCA’s Q&As clarify that the request does not apply to AIM companies, which should consult their NOMAD.
This is a rapidly-moving situation and the FCA, FRC and PRA are in talks about a package of measures to ease this pressure which will be announced shortly.
The FRC’s supporting statement is available here.
The FCA’s Primary Market Bulletin 27 – Coronavirus update can be found here.
The FRC’s materials for auditors and companies on the impact of Covid-19 can be found here.
Companies House has published details of how to request a delay to the filing of accounts here.
ICSA and Slaughter & May’s Guidance Note on AGMs and the impact of Covid-19 can be found here.
Deloitte’s Need to know on the accounting considerations relating to Covid-19 can be found here.
You can sign up for Deloitte’s weekly Responding to Covid-19 webinar here.