Restoring trust through the Resilience Statement

One of the most significant proposals from Sir Donald Brydon’s review of the quality and effectiveness of audit that was taken forward by Government in the BEIS “Restoring trust in audit and corporate governance” consultation is the idea of a ‘Resilience Statement’ that “incorporates, enhances and builds on the going concern and viability statements”.

The Government intended to introduce a statutory requirement for a Resilience Statement for Public Interest Entities (PIEs) with 750 or more employees and £750m or more annual turnover. The legislation to implement this requirement has been withdrawn, but we believe there are many elements to the proposed Resilience Statement that could address the issues with the existing viability statement, and (by association) going concern reporting that were identified in the reviews by Sir Donald Brydon and also Sir John Kingman in his review of the FRC. To illustrate this, we have worked through how a Resilience Statement could be developed in practice and brought it to life by producing a full illustrative example based on a fictitious company.

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