In the early days of the COVID-19 outbreak, many thought that it was just a health issue with little or no consideration for the potential impact the virus could have on governance and the smooth running of business activities. Countries and reporting entities planned their 2020 budget without any reference or assumption to the likely negative effects of COVID-19 in their projected revenues and cash flows.
Also, there was no thought of the inevitable extra-budgetary spending on health facilities to combat the disease and no one envisaged the current demands for palliative measures to ameliorate the effect of the lockdown/curfew imposed by governments on citizens and businesses.
As COVID-19 spreads and the impact is felt, regulators in Nigeria and around the world have issued guidance to entities under their control to provide direction on the impact of COVID-19 on the reporting obligations of those entities. The Financial Reporting Council of Nigeria (FRC or the Council) on 6 April 2020 issued guidelines for External Auditors on COVID-19 and its impact on the audit of financial statements. This was in a bid to provide appropriate guidance to external Auditors on the impact of COVID-19 on financial statements audit of reporting entities in Nigeria
This publication discusses the FRC guidance for External Auditors and also highlight other matters to be considered on the audit of reporting entities in Nigeria.