Going Concern

Going concern can be an issue for companies and auditors as well.

FASB requires certain disclosures when substantial doubt is present, even if management plans mitigate the risk. So when an entity knows it will not be able to meet its ongoing obligations, it should make an assessment regarding going concern.

Auditors need to determine whether required going concern disclosures are in the financial statements. Additionally, they need to determine if substantial doubt is present. If it is, then a going concern paragraph in the audit opinion is required.