Coronavirus: keep the information flowing to markets

30 March 2020: For listed companies, keeping the market up to date with information is as important as ever, notwithstanding that they have been given an extra time to publish their audited financial statements, writes ICAEW’s Katerina Joannou.

On 26 March, the Financial Conduct Authority (FCA), Financial Reporting Council (FRC) and Prudential Regulation Authority (PRA) announced a series of joint actions to allow companies more time to publish results due to the ongoing impact of the coronavirus pandemic.

As part of the joint regulatory approach to coronavirus, the FCA wants to “ensure that appropriate disclosure continues” to allow investors and the market to continue to price securities effectively.

Appropriate disclosure is key to maintaining orderly markets and market integrity – a sentiment expressed by the FCA and other international securities regulators such as IOSCO and ESMA).

Companies continue to be subject to the disclosure obligations laid down in Article 17 of the Market Abuse Regulation (MAR) – in particular, the disclosure obligations concerning inside information.

Companies’ usual reporting and controls processes and governance will likely be disrupted or challenged by measures taken to tackle COVID-19. Therefore, it may be helpful to turn to sources of information and existing commentary on best practices:

• FCA Market Watch Issue No 58 includes practical commentary on companies’ obligations under MAR and on insider lists
• FCA Market Abuse Regulation sets out the application of the regulation, with references to the FCA’s DTR handbook rules
• AIM companies are reminded by the London Stock Exchange (LSE) that timely and accurate disclosure is a key requirement under the AIM Rules and all AIM companies should continue to meet their disclosure obligations without delay (Inside AIM newsletter, Coronavirus – Temporary measures). 
• Guidance on the application of the MAR to AIM companies was published in previous Inside AIM newsletters.  
• Directors of both listed companies and AIM companies may find it helpful to refer to ICAEW’s Guidance on financial position and prospects (FPP) procedures as they maintain their ongoing obligations, including their responsibility to maintain FPP procedures.

For the latest news, insight and guidance for accountants on the COVID-19 outbreak, visit ICAEW’s dedicated Coronavirus Hub.