going-concern statement

An auditor's statement that there is concern whether the company being audited can remain in business. A going-concern statement indicates equity investors are at substantial risk.

References in periodicals archive ?

The court found that the payments were ordinary, because an expert witness testified that such payments were common in business, and that they were necessary, because the forbearance agreement prevented the company's auditors from issuing a going-concern statement, which helped the taxpayer's financial situation.

Some forbearance payments deductible, some not

But there is also a wider sense of unease about going-concern statements. The Companies Act 2006 requires the directors of a company to include a business review in the annual report and accounts.

Going consternation: auditors are seeking more and more assurances from their clients about their businesses' continuing viability before they will sign off their accounts without qualification. Robin Johnson explains the liabilities facing directors

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