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The Financial Reporting Council (FRC) has reportedly warned of the potential impact the coronavirus will have on company audits.
According to Sky News, the FRC fears the virus will impact auditor’s abilities to scrutinise the books of Chinese companies. This is because under Chinese data protection law auditing of companies must be conducted within the country and cannot be done remotely.
This will pose problems with many multinationals that have operations and subsidiaries in China. As such the FRC has reportedly started talks with major audit firms to identify audits that may be delayed.
Sources cited by Sky News claim that an official statement from the FRC is expected in the coming days and that one possible solution may see companies appointing temporary auditors.
At the time of writing the coronavirus epidemic has seen 71,444 globally and around 1,776 deaths – mainly in China.
The news also comes after digger manufacturer JCB announced it is to reduce its production and working hours thanks to a shortage in supply of components from China.
