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Turbulent credit market conditions mean corporate reporting and governance risks are higher than they have been for “some years”, the Financial Reporting Council warns. The regulator said there were “dramatic” liquidity challenges for financial institutions – as well as indications that these conditions were affecting the availability of credit to companies more generally.
And it warned that these increased risks meant that additional diligence was needed on the part of preparers of accounts, members of audit committees and auditors this year. Any increase in corporate reporting risks will have a significant impact on schemes.
FRC chief executive Paul Boyle said: “Corporate reporting and auditing will be particularly challenging this year and needs to be matched by increased diligence and then clarity as to the basis on which judgements have been exercised.”
By Jonathan Stapleton