Going concern accouting

Original Post:

Red Wood

Red Wood

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Jan 14, 2014
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London
  • #1
    New customer, decent size, but accounting principle is going concern to atleast end of the financial year 2022 (Dec).

    Conflicting information online. Is it anything to worry about.

    Extra info, large American owner who is selling them after a few years.

    Lastly, what other types of accounting principles are there like going concern?
     
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    Mark T Jones

    Mark T Jones

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    Nov 4, 2015
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    www.fitoutfinance.co.uk
  • #3
    Historcally, 'going concern' was a huge red flag - used only where there were significant concerns.

    More recently it has been adopted as a general cover all for accountants - to the extent that credit people no longer give it a second glance. There are of course other questions to be asked around qualifications.
     
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    MyAccountantOnline

    MyAccountantOnline

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  • #5
    Red Wood said:
    New customer, decent size, but accounting principle is going concern to atleast end of the financial year 2022 (Dec).

    Conflicting information online. Is it anything to worry about.

    Extra info, large American owner who is selling them after a few years.

    Lastly, what other types of accounting principles are there like going concern?
    Click to expand...
    When accounts are prepared the directors are responsible for ascertaining whether the company can continue as a going concern. When they do that they take into account all relevant information including whether the company has sufficient cash funds etc covering at least 12 months from the date the accounts are approved. If you want a detailed read the ACCA have a technical factsheet here

    https://www.accaglobal.com/us/en/te...ly/technical-factsheet-187-going-concern.html

    Other accounting principles are here
     
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    Red Wood

    Red Wood

    Free Member
    Jan 14, 2014
    851
    118
    London
  • #7
    H
    Mark T Jones said:
    Historcally, 'going concern' was a huge red flag - used only where there were significant concerns.

    More recently it has been adopted as a general cover all for accountants - to the extent that credit people no longer give it a second glance. There are of course other questions to be asked around qualifications.
    Click to expand...
    Hi Mark, what other qualification questions should we be thinking outside the obvious surrounding funding/cashflow
     
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