Which of the following statements regarding the going concern concept is FALSE?
A) Generally accepted accounting principles are based on the going-concern concept.
B) Dealing with questions of going concern is difficult because auditors are forced to evaluate matters of financial analysis, business strategy, and financial forecasting.
C) Management is responsible for determining whether there is a significant doubt about a company's ability to continue as a going concern.
D) Financial difficulties, labour problems, loss of key personnel, litigation, and other such things may be important signals.

Question

Quizplus · Accepted Answer

Management is responsible for assessing the company's ability to continue as a going concern, but auditors also evaluate this assessment. The statement implies that only management is responsible, which is misleading.

Which of the Following Statements Regarding the Going Concern Concept