AASB Staff Paper: Going Concern Disclosures: A Case for International Standard-Setting

Thursday, October 21, 2021

The AASB has released a new staff paper Going Concern Disclosures: A Case for International Standard-Setting which identifies potential areas for improvement relating to the existing going concern disclosure requirements in the IFRS Standards.

Specifically, the staff paper serves to:

(a) identify any issues and available evidence regarding the adequacy of going concern disclosures currently required by the Accounting Standards;

(b) identify any issues relating to the lack of guidance on the basis of preparation where the going concern assumption is no longer appropriate; and

(c) suggest to the IASB how to address the issues identified.

Based on the findings of the paper, it is recommended that the IASB:

(a) revisit IAS 1 Presentation of Financial Statements to include specific examples and more explicit step-by-step guidance for preparers on how to assess going concern in the Application Guidance of IAS 1; and

(b) initiate a research project to better understand how regulation in various jurisdictions affect the preparation of financial statements if prepared on a non-going concern basis and the current diversity to assess whether any guidance should be issued.

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