The Institute of Chartered Accountants of England and Wales (ICAEW), the leading chartered accountancy body, have just published a free guidance document for owners and directors of small and medium-sized businesses to assess business prospects in the wake of COVID-19. I thought it may be a useful read for you and your business considering our most frequently asked questions at the moment are all on the topics of finance and grants.
To give you an overview, here’s what it covers:
What is the guidance for?
For company directors to assess the viability of the business and whether the business is a going concern when drawing up the annual accounts. This should cover at least the 12 months from the date the accounts are to be approved by directors.
What is different this year?
Accounts must always provide a true and fair view of the financial performance and position of the business. Coronavirus has had a dramatic change on the performance and prospects of many businesses, leaving some under threat, and accounts will have to reflect its impact. In the current circumstances that may well necessitate the inclusion of a number of additional disclosures relating to going concern in the notes to the accounts to enable stakeholders to understand the impact that COVID-19 has, or may have, on the business.
When will this guidance be useful?
For end of year accounts being prepared, the guidance assists by outlining the importance of providing evidence via cashflow forecasting that shows that any conclusions made relating to these going concerns are reasonable and how to accurately reflect the impact of Covid-19.
The PDF guide can be downloaded here:
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