diff --git a/src/compiler/program.ts b/src/compiler/program.ts
index 2bbf17e6098..ea331db57d2 100644
--- a/src/compiler/program.ts
+++ b/src/compiler/program.ts
@@ -2811,7 +2811,10 @@ namespace ts {
     export function parseConfigHostFromCompilerHost(host: CompilerHost): ParseConfigFileHost {
         return {
             fileExists: f => host.fileExists(f),
-            readDirectory: (root, extensions, includes, depth?) => host.readDirectory ? host.readDirectory(root, extensions, includes, depth) : [],
+            readDirectory(root, extensions, excludes, includes, depth) {
+                Debug.assertDefined(host.readDirectory, "'CompilerHost.readDirectory' must be implemented to correctly process 'projectReferences'");
+                return host.readDirectory!(root, extensions, excludes, includes, depth);
+            },
             readFile: f => host.readFile(f),
             useCaseSensitiveFileNames: host.useCaseSensitiveFileNames(),
             getCurrentDirectory: () => host.getCurrentDirectory(),