The Financial Reporting Council (“FRC”), prompted by the current economic uncertainties facing countries around the world, published on 17 January 2012 an update for directors of UK listed companies on responding to increased country and currency risk in financial reports. The update “aims to draw together a number of the more significant issues directors may reflect when considering how best to provide a balanced and understandable assessment of a company’s position and prospects in the context of increased country and currency risk”....
Political and economic events (such as: regime changes in the Middle East; funding pressures on certain European countries; austerity measures being adopted across Europe; and the increasing likelihood of one or more countries being forced to leave the Eurozone) are all likely to impact on growth rates and demand for consumer products across Europe. Economic conditions may lead to delays and/or defaults under contracts with trading partners, suppliers and customers and impact upon expectations of future business volumes and margins...
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