If the auditor discovers that management intends to liquidate the entity:
A)it is irrelevant if they did not intend to liquidate the entity at reporting date.
B)it requires inclusion as a disclaimer of opinion.
C)it requires inclusion as an 'except for' opinion.
D)the going concern basis is inappropriate.

Question

Quizplus · Accepted Answer

If management intends to liquidate the entity, the going concern basis is inappropriate because the entity is not expected to continue its operations in the foreseeable future.

If the Auditor Discovers That Management Intends to Liquidate the Entity