The novel coronavirus (COVID-19) pandemic has spread around the globe. The virus has taken its toll on not just human life, but businesses and financial markets too, the extent of which is currently indeterminate. Entities need to carefully consider the accounting implications of this situation.
Some of the worst hit sectors include:
Aviation and Aircraft leasing is facing massive disruption with travel restrictions imposed by most jurisdictions;
Hospitality sector has been impacted with low occupancy in business and holiday destinations having to close down entirely;
Automobiles, apparel, consumer durables, pharmaceuticals, leather goods, electronics and others where the supply chain is dependent on countries worst hit by COVID-19; and
Financial services have also been affected with significant investment losses with the Dow Jones index down 5% YTD with some of its leading financial services companies down up to 30% YTD. The FTSE 100 down 23% YTD with some of its leading financial services companies down up to 50% YTD.
These presentation slides identifies some key financial reporting areas that entities need to consider when determining the impact on their business, and on the results, financial position and disclosures in their financial statements. This is not an exhaustive list and there may be other areas not included in this presentation that entities should consider. The areas are not listed in order of importance.