Statement on auditing standards, 059

              Statement on
Auditing Standards
April 1988
AICPA American Institute of
Certified Public Accountants
The Auditor's Consideration of
an Entity's Ability to Continue as
a Going Concern
( Supersedes Statement on Auditing Standards No. 34, AICPA, Professional
Standards, vol. 1, AU sec. 340.)
1. This Statement provides guidance to the auditor in conducting an
audit of financial statements in accordance with generally accepted
auditing standards with respect to evaluating whether there is substan­tial
doubt about the entity's ability to continue as a going concern. 1 ,2
Continuation of an entity as a going concern is assumed in financial
1This Statement does not apply to an audit of financial statements based on the assump­tion
of liquidation ( for example, when [ a] an entity is in the process of liquidation, [ b]
the owners have decided to commence dissolution or liquidation, or [ c] legal proceed­ings,
including bankruptcy, have reached a point at which dissolution or liquidation is
probable). See Auditing Interpretation, Reporting on Financial Statements Prepared
on a Liquidation Basis of Accounting ( AICPA, Professional Standards, vol. 1, AU sec.
9509.33-. 38).
2The guidance provided in this Statement applies to audits of financial statements pre­pared
either in accordance with generally accepted accounting principles or in accor­dance
with a comprehensive basis of accounting other than generally accepted
accounting principles. References in this Statement to generally accepted accounting
principles are intended to include a comprehensive basis of accounting other than
generally accepted accounting principles ( excluding liquidation basis).
Copyright © 1988 by the
American Institute of Certified Public Accountants, Inc.
1211 Avenue of the Americas, New York, N. Y. 10036- 8775
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