FCA calls on UK firms to defer results

LONDON: British companies yesterday rushed to heed unprecedented calls by regulators to mothball their results in the face of the escalating coronavirus.

Britain’s Financial Conduct Authority said on Saturday that listed companies planning to report over the next few days should hold off for two weeks to better assess how the pandemic is affecting their business.

The move, the first time UK Plc has ever been asked to suspend results en masse, follows similar actions in countries including Spain and China and comes as firms grapple with just how deep an expected global recession is likely to be.

British companies to respond to the FCA’s call early yesterday included home improvement group Kingfisher which said it would delay full-year results for at least two weeks.

Kingfisher said it had received a letter from the FCA on Sunday requesting a delay to the results announcement, which had been due today.

The company said it would provide further updates “as soon as we are advised by the FCA”.

Drinks maker A.G. Barr, outsourcer Mears Group, financial services company STM Group and energy engineering company Lamprell also said they were suspending results.

At least 50 companies were expected to report in the week to March 27, data from Refinitiv showed.

The Financial Reporting Council (FRC), which polices accountants that check the books of listed companies in Britain, said yesterday that it backed the FCA’s decision and that auditors could broaden their approach to delays in company financial statements as the situation “rapidly” evolves.

“It is important that due consideration is given by companies to these events in preparing all reporting,” the FRC said.

“The FRC therefore encourages listed companies and their auditors to consider carefully whether they should delay other corporate reports for the next two weeks, such as interim financial statements and final audited financial statements, except where necessary to meet a legal or regulatory requirement,” the watchdog said in a statement.

The FCA, FRC and the Bank of England’s Prudential Regulation Authority are expected to come out with a further package of measures, perhaps as soon as this week.

PwC and KPMG, two of the world’s “Big Four” auditing firms, welcomed the delay.

“It is clear that given the pressures on people and the changes that we see day to day, it is in the public interest for reporting to be delayed to give companies the time to properly consider the impacts on their results,” said Jon Holt, head of audit at KPMG UK.