COVID-19 PANDEMIC AND FINANCIAL REPORTING: A CONTEXTUAL ANALYSIS

COVID-19 pandemic unexpectedly ushered in a new normal in the world order. It is a health challenge but the preventive measures deployed caused an unprecedented impact on business entities’ operation which undoubtedly has significant implications on financial reporting. The challenge of understanding the impact particularly on how entities affected can account and make disclosures is necessarily germane. Provision of reasonable guidance to accounting practitioners and issuers of financial statements is of utmost priority to ensure fair representation of companies’ results. This overriding concern motivated the study to examine the pandemic impact on firms with an emphasis on financial reporting. The main objective is to highlight how COVID-19 impact can be accounted for and reflected in financial reporting taking into accounting: events after the reporting period- whether they are adjusting and non-adjusting events; financial statements presentation, going concern principle; fair value measurements, financial assets and liabilities impairment including non-financial assets; property, plant, and equipment; borrowing cost; leases, provisions, contingent assets and liabilities; inventories; and revenue from contracts. The literature review methodology was adopted supplemented by documentations from other books and commentaries including authors’ observations from the numerous reviews. On this basis, the study was able to indicate the pandemic impact on financial reporting in the context of firms with reporting dates on 31^st December 2019 and those with reporting dates within the year, 2020. Following was the study recommendations which harped on the deployment of appropriate professional judgment, compliance with the relevant IFRS and IAS standards that provide the necessary guidance on the way and manner COVID-19 disruption can be accounted for and reflected in financial reports of business entities.