Recent corporate collapses such as BHS and Carillion have put “going concern” statements in the spotlight. New guidance will make non-executive directors—especially those on the audit committee—part of the assessment.
Photo: Lucas Hayas, Flickr
At the current rate, financial reporting watchdogs modify the rules about the much-discussed “going concern” statement every five to seven years. This week the Financial Reporting Council maintained the record, this time with an overhaul that not only boosts the role of auditors, but also charges them to go above the heads of management to those in charge of governance if they believe their worries are not being heard. Non-executives, especially on the audit committee, are now firmly part of the going concern assessment.
Going concern judgements are part of the audit of annual accounts. To give it the technical description, a company i
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