IFRS - Potential effects of the coronavirus outbreak on 2020 reporting

IFRS - Potential effects of the coronavirus outbreak on 2020 reporting

The effects of the coronavirus may be very wide spread, and relate to many industries; they are not limited only to entities operating directly in the travel and tourism industry (e.g. airlines, tour operators, etc.).

Coronavirus may affect entities in nearly every sector, due to the following impacts: 

  • Reduced consumer demand for goods and services due to lost income and/or restrictions on consumers’ ability to move freely;
  • Lack of investment in capital improvements and construction reducing demand for many goods and services;
  • Reduction in market prices for commodities and financial assets, including equity and debt instruments; and
  • Disruption of global supplies chains due to restrictions placed on the movement of people and goods.

The financial reporting implications for entities may be similarly broad, and the precise effects will depend on the facts and circumstances of each entity. As time elapses and the effects of the outbreak change and evolve, it may become difficult to distinguish which information and facts and circumstances should be incorporated into measurement as at period end and which should result in potential subsequent event disclosure. The following are financial reporting considerations that entities and engagement teams need to consider.

Read our IFRS Bulletin (March, 2020, pdf).