alleryStart learning →Does a going concern emphasis of matter necessarily mean imminent insolvency?
AYes, within one month
BNo, not necessarily
CYes, in every case
DOnly for private firms
Answer & Solution
Correct answer: B. No, not necessarily
Such a paragraph raises perceived risk but is not proof the company is on the verge of insolvency.
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Related questions
Under UK and Irish standards, an entity is a going concern unless management does what?Which item would an auditor weigh when judging doubt about going concern?For how long must an auditor test going concern ability after the audited statement date?The going concern principle allows a company to defer which items to future periods?How does the value of a going concern compare with its breakup value?The going concern basis is presumed unless what is imminent?When liquidation of an entity becomes imminent, which basis is used for its statements?Going concern statements assume the entity will do what?