March 4, 2020 / 2:34 PM / a month ago

Company audit delays due to coronavirus possible - UK watchdog

LONDON (Reuters) - Britain’s accounting watchdog would deal pragmatically and sympathetically with requests to delay company audits due to the coronavirus epidemic, it said on Wednesday.

Workers, including one wearing a protective face mask, arrive during the morning rush hour at Waterloo Station in London, Britain, March 4, 2020. REUTERS/Toby Melville

Deloitte, one of the world’s “Big Four” auditors, said on Tuesday that one of its employees has tested positive for coronavirus, and Britain’s government expects more cases across the country in coming weeks.

Jon Thompson, chief executive of the Financial Reporting Council (FRC), said it was “plausible” the watchdog would face requests for delays and it was in touch with audit firms regarding the “practical challenges” they encounter.

British is home to stock market listings for many international companies and some have operations in countries such as China, where the epidemic began and where audits must be conducted locally.

Apart from Deloitte, no other auditor has notified the FRC about staff exposed to coronavirus or have signalled any difficulty in completing audits on time, Thompson said.

If a listed company wants to delay its results because it can’t get its audit signed off in time, it would need to inform the FRC and, if it has a premium London listing, the Financial Conduct Authority as well.

“We have not had any requests yet to delay signing but it’s a dynamic situation and we just need to keep it under review,” Thompson told Reuters.

“We have to be realistic because the companies listed on the London stock market are very widespread. If we get an application, we would deal with it in an appropriate way, and would be sympathetic to the situation,” Thompson said.

Last month, the FRC, which regulates auditors and corporate governance, asked listed companies to be transparent about the risks they face to their business from the coronavirus.

The FRC is still allowing its staff to travel, but this is being reviewed on a daily basis, Thompson said.

Reporting by Huw Jones; Editing by Mark Potter

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