In addition to focusing on specific financial reporting considerations from a COVID-19 perspective, PwC's "COVID-19: Audit committee financial reporting guidebook" reminds audit committees to deliberately consider other COVID-19-prompted impacts on processes and practices that bear on the quality of financial reporting, including changes in:
- ICFR, including practices and processes being performed differently due to remote working conditions, insufficient resources, etc.
- Operation of internal reporting structures (e.g., risk, HR, legal, compliance)
- Whistleblower systems or processes, investigations, and resolution timeliness
- How and when material issues are reported to the board
- Internal audit plans and priorities (which should reflect a changing risk environment)
The guidebook is equally beneficial for management engaging with the audit committee on these issues.
PwC's "Q2 2020 Audit committee newsletter: Helping you prepare for your next meeting" homes in on likely Q2 reporting topics including accounting for employee terminations and other restructuring activities, COVID-19-related disclosure, structured payables programs (supply chain financing, reverse factoring arrangements), and considerations around returning to the workplace, going concern, and fraud.
See Cleary's "Q2 Reporting: How Should a U.S. Public Company Quantify the Impact of COVID-19?"; last week's report: "Financial Reporting in Focus"; and additional information and resources on our Audit Committees and Financial Reporting >> Coronavirus (COVID-19) pages. This post first appeared in the weekly Society Alert!