Boardrooms used to close down for summer while the accountants got the results ready for directors to announce when they returned after the August Bank Holiday. The accountants have retaliated, however, becoming so efficient that boards this year had to break their vacation to issue figures when everyone else is still on the beach.
Directors have had to drive up from Cornwall, fly back from Switzerland or abandon the yacht in the Mediterranean — leaving families abroad or dragging children home prematurely — to attend board meetings to rubber-stamp results.
The week before the English bank holiday at the end of August was crammed with companies issuing results with more than 70 plcs announcing profits (or losses) on the Thursday alone.
Technology and pressure from governance bodies have conspired to shorten the time between accounting periods closing and announcements to the London Stock Exchange.
The drinks company Diageo is typical: in 2001 it announced its full-year figures on 6 September after everyone was back from their summer holidays. This year it was among the companies producing results on that “Super Thursday” ahead of the bank holiday, even though its customers were still sipping their Pimm’s. Diageo’s announcement date has advanced by a day each year.
Engineering group IMI is a similar case: its 2001 interim figures were published on 10 September but in 2009 they came out on 27 August. This was also the first time that Savills estate agency released results ahead of the bank holiday.
In past years boardrooms were locked up for August with the regular monthly meeting cancelled. Manufacturing companies closed their plants too during this period, waving away the workers on their wake’s week. Even when pre-close trading updates became fashionable, they could be announced before the June year-end or interim date, putting directors into a close period that prevented them from saying more even if they had stayed in the office.
Only the internal accountants or external auditors had to forfeit their summer holidays to keep crunching the numbers while the others enjoyed themselves. Their task was to have the figures ready for when the directors returned after the bank holiday and business resumed.
The trend to earlier results can be seen throughout the year but no-one complains when December year-end accounts arrive in February instead of March. For March year-ends, quicker accounting has meant annual meetings can be held before directors disperse in July. But faster figures mean bunching — hence busy days like Super Thursday that overwhelm the analysts and compete for newspaper coverage. This year all the big banks produced half-year figures in the same week.
But never mind whether City analysts can cope with the rush of results before the bank holiday, where they even at their desks or had they slumped into the deckchairs vacated by directors hurrying back to board meetings? Directors with June accounting dates must be tempted to change their year-end to save future holidays.
