diff --git a/packages/bazel/src/ngc-wrapped/index.ts b/packages/bazel/src/ngc-wrapped/index.ts
index 78e2ee1486..81b8b36491 100644
--- a/packages/bazel/src/ngc-wrapped/index.ts
+++ b/packages/bazel/src/ngc-wrapped/index.ts
@@ -205,7 +205,7 @@ export function compile({allowNonHermeticReads, allDepsCompiledWithBazel = true,
   const tsickleEmitResult = emitResult as tsickle.EmitResult;
   let externs = '/** @externs */\n';
   if (diagnostics.length) {
-    console.error(ng.formatDiagnostics(compilerOpts, diagnostics));
+    console.error(ng.formatDiagnostics(diagnostics));
   } else {
     if (bazelOpts.tsickleGenerateExterns) {
       externs += tsickle.getGeneratedExterns(tsickleEmitResult.externs);
diff --git a/packages/compiler-cli/src/main.ts b/packages/compiler-cli/src/main.ts
index b34cf29596..d373cb8c89 100644
--- a/packages/compiler-cli/src/main.ts
+++ b/packages/compiler-cli/src/main.ts
@@ -28,15 +28,15 @@ export function main(
   let {project, rootNames, options, errors: configErrors, watch, emitFlags} =
       config || readNgcCommandLineAndConfiguration(args);
   if (configErrors.length) {
-    return reportErrorsAndExit(options, configErrors, consoleError);
+    return reportErrorsAndExit(configErrors, consoleError);
   }
   if (watch) {
     const result = watchMode(project, options, consoleError);
-    return reportErrorsAndExit({}, result.firstCompileResult, consoleError);
+    return reportErrorsAndExit(result.firstCompileResult, consoleError);
   }
   const {diagnostics: compileDiags} = performCompilation(
       {rootNames, options, emitFlags, emitCallback: createEmitCallback(options)});
-  return reportErrorsAndExit(options, compileDiags, consoleError);
+  return reportErrorsAndExit(compileDiags, consoleError);
 }
 
 function createEmitCallback(options: api.CompilerOptions): api.TsEmitCallback|undefined {
@@ -128,11 +128,10 @@ export function readCommandLineAndConfiguration(
 }
 
 function reportErrorsAndExit(
-    options: api.CompilerOptions, allDiagnostics: Diagnostics,
-    consoleError: (s: string) => void = console.error): number {
+    allDiagnostics: Diagnostics, consoleError: (s: string) => void = console.error): number {
   const errorsAndWarnings = filterErrorsAndWarnings(allDiagnostics);
   if (errorsAndWarnings.length) {
-    consoleError(formatDiagnostics(options, errorsAndWarnings));
+    consoleError(formatDiagnostics(errorsAndWarnings));
   }
   return exitCodeFromResult(allDiagnostics);
 }
@@ -140,7 +139,7 @@ function reportErrorsAndExit(
 export function watchMode(
     project: string, options: api.CompilerOptions, consoleError: (s: string) => void) {
   return performWatchCompilation(createPerformWatchHost(project, diagnostics => {
-    consoleError(formatDiagnostics(options, diagnostics));
+    consoleError(formatDiagnostics(diagnostics));
   }, options, options => createEmitCallback(options)));
 }
 
diff --git a/packages/compiler-cli/src/ngtools_api2.ts b/packages/compiler-cli/src/ngtools_api2.ts
index d4c1c0ab2f..0a760b1623 100644
--- a/packages/compiler-cli/src/ngtools_api2.ts
+++ b/packages/compiler-cli/src/ngtools_api2.ts
@@ -131,6 +131,6 @@ export function createCompilerHost(
 
 // Wrapper for formatDiagnostics.
 export type Diagnostics = Array<ts.Diagnostic|Diagnostic>;
-export function formatDiagnostics(options: CompilerOptions, diags: Diagnostics): string {
-  return formatDiagnosticsOrig(options, diags);
+export function formatDiagnostics(diags: Diagnostics): string {
+  return formatDiagnosticsOrig(diags);
 }
\ No newline at end of file
diff --git a/packages/compiler-cli/src/perform_compile.ts b/packages/compiler-cli/src/perform_compile.ts
index 0bfcf98fbb..f3f419eec7 100644
--- a/packages/compiler-cli/src/perform_compile.ts
+++ b/packages/compiler-cli/src/perform_compile.ts
@@ -23,13 +23,15 @@ export function filterErrorsAndWarnings(diagnostics: Diagnostics): Diagnostics {
   return diagnostics.filter(d => d.category !== ts.DiagnosticCategory.Message);
 }
 
-export function formatDiagnostics(options: api.CompilerOptions, diags: Diagnostics): string {
+const defaultFormatHost: ts.FormatDiagnosticsHost = {
+  getCurrentDirectory: () => ts.sys.getCurrentDirectory(),
+  getCanonicalFileName: fileName => fileName,
+  getNewLine: () => ts.sys.newLine
+};
+
+export function formatDiagnostics(
+    diags: Diagnostics, tsFormatHost: ts.FormatDiagnosticsHost = defaultFormatHost): string {
   if (diags && diags.length) {
-    const tsFormatHost: ts.FormatDiagnosticsHost = {
-      getCurrentDirectory: () => options.basePath || process.cwd(),
-      getCanonicalFileName: fileName => fileName,
-      getNewLine: () => ts.sys.newLine
-    };
     return diags
         .map(d => {
           if (api.isTsDiagnostic(d)) {
diff --git a/packages/compiler-cli/test/ngc_spec.ts b/packages/compiler-cli/test/ngc_spec.ts
index 6c38d7d75d..82511a33b3 100644
--- a/packages/compiler-cli/test/ngc_spec.ts
+++ b/packages/compiler-cli/test/ngc_spec.ts
@@ -44,6 +44,7 @@ describe('ngc transformer command-line', () => {
   beforeEach(() => {
     errorSpy = jasmine.createSpy('consoleError').and.callFake(console.error);
     basePath = makeTempDir();
+    process.chdir(basePath);
     write = (fileName: string, content: string) => {
       const dir = path.dirname(fileName);
       if (dir != '.') {
diff --git a/packages/compiler-cli/test/test_support.ts b/packages/compiler-cli/test/test_support.ts
index 38dd9e9678..122bb64492 100644
--- a/packages/compiler-cli/test/test_support.ts
+++ b/packages/compiler-cli/test/test_support.ts
@@ -112,7 +112,7 @@ export function setup(): TestSupport {
 export function expectNoDiagnostics(options: ng.CompilerOptions, diags: ng.Diagnostics) {
   const errorDiags = diags.filter(d => d.category !== ts.DiagnosticCategory.Message);
   if (errorDiags.length) {
-    throw new Error(`Expected no diagnostics: ${ng.formatDiagnostics(options, errorDiags)}`);
+    throw new Error(`Expected no diagnostics: ${ng.formatDiagnostics(errorDiags)}`);
   }
 }