SEBI wants listed companies to disclose financial impact of pandemic
Photo Credit: Reuters

The Securities and Exchange Board of India said on Wednesday publicly listed companies should reveal the financial impact of the coronavirus pandemic, in line with international practices.

The capital markets regulator said in a circular that many listed companies have made disclosures pertaining to a shutdown of their operations or the safety and sanitation measures they have taken. But only a small number of companies have disclosed the financial impact of the pandemic.

However, listed companies around the world have been making disclosures regarding the impact of the pandemic, including that on financial condition, future operations, capital and financial resources, liquidity and assets, SEBI said. It added that Indian companies, too, should disclose such information.

“Towards this end, entities are encouraged to evaluate the impact of the COVID-19 pandemic on their business, performance and financials, both qualitatively and quantitatively, to the extent possible and disseminate the same,” the regulator said.

COVID-19 is the lung disease caused by the new coronavirus. It has affected nearly five million people worldwide and led to the deaths of more than 325,000 people so far. In India, the number of coronavirus infections has crossed 106,000 with the death toll above 3,300.

SEBI said that companies may consider disclosing information such as their ability to maintain operations including factories and offices, schedule for resuming operations, steps taken to ensure smooth functioning of operations and an estimate of the future impact of the pandemic.

Companies should also disclose the pandemic’s impact on capital and financial resources, liquidity, profitability, ability to service debt, assets, supply chain and demand for goods and services, SEBI said.

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