Which of the following is least likely to cause uncertainty about the ability of an entity to continue as a going concern?
A) Working capital deficiencies.
B) Significant recurring operating losses.
C) Loss of major customers.
D) A client's lawsuit against another company which claims the other company has infringed on its patent.

Question

Quizplus · Accepted Answer

A client's lawsuit against another company for patent infringement is less directly related to the financial health or operational stability of the entity in question compared to working capital deficiencies, significant recurring operating losses, or the loss of major customers. These other factors directly impact the entity's ability to generate revenue and manage its debts, thus more directly influencing its ability to continue as a going concern.

Which of the Following Is Least Likely to Cause Uncertainty