The Financial Reporting Council (FRC) has issued a discussion paper looking at the role of auditors and their involvement in the preliminary announcements of annual results, with a view to updating the current auditor guidance
The regulator says the most common approach is for preliminary results to be based on audited information, although a minority of companies publish preliminaries based on unaudited information. Some listed entities have been moving towards the simultaneous publication of annual results in ‘preliminary’ form alongside the statutory financial statements.
Its stakeholder engagement work suggests that there is limited understanding of the current role of the auditor when agreeing to the publication of preliminaries. The FRC has therefore identified a range of options to support the revision of its guidance to provide greater clarity.
The FRC discussion paper is intended to stimulate an open discussion with stakeholders about the use and value of preliminary announcements in the UK, and the role of the auditor in respect to such announcements, with a particular focus on the London stock exchange main market. Respondents are encouraged to also share other innovative ideas or emerging practice for consideration that fall outside of the scope of the options the FRC has outlined in its discussion paper.
The deadline for comments is 23 June and should be sent to James Ferris: [email protected]
The FRC discussion paper - Invitation to comment: Auditors and Preliminary Announcements is here.
