ISA 570 · General

Going Concern Checklist

Score the ISA 570 indicators, evaluate the mitigation plan, and copy a defensible material-uncertainty paragraph straight into the file.

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Going Concern
Checklist.

Session
0x3EAE
FY End
not set
Currency
€
engagement.conf
indicators.list
README.md
01// engagement_context— ISA 570.3
02entity_name=
03fy_end=
04expected_auth_date=
05entity_type=
06initial_engagement=
07currency=
08// indicators— ISA 570.A2–A7 (0/21 selected)
No indicatorsscore: 0awaiting selection0/21 indicators
✓highfinNet liability or net current liability position
✓highfinFixed-term borrowings approaching maturity without realistic refinancing prospects
✓highfinLoan covenant breaches or indications that financial support may be withdrawn
✓highfinSubstantial operating losses or significant deterioration in the value of assets
✓mediumfinArrears or discontinuance of dividends
✓mediumfinInability to pay creditors on due dates
✓mediumfinAdverse key financial ratios
✓mediumfinNegative operating cash flows indicated by historical or prospective financial statements
✓highopeManagement intentions to liquidate the entity or cease operations
✓highopeLoss of key management or personnel without replacement
✓highopeLoss of a major market, franchise, licence, or principal supplier
✓mediumopeLabour difficulties or shortages of important supplies
✓mediumopeFundamental changes in market or technology that the entity cannot adapt to
✓lowopeDependence on the success of a particular project
✓highothLegal proceedings or regulatory action that may result in claims the entity cannot meet
✓highothChanges in law or regulation expected to adversely affect the entity
✓mediumothNon-compliance with capital or other statutory requirements
✓mediumothCatastrophic loss of a major asset
✓lowothExcessive dependence on short-term borrowings to fund long-term assets
✓mediumothBusiness interruption from cyber attacks or IT system failure
✓mediumothExposure to climate-related physical or transition risks threatening the business model
15// events_conditions_rationale— ISA 570.10–11 · independent identification
16auditor.identification=
17management.own_list=
Events & conditions · independent identification (ISA 570.10–11)
20// management_assessment— ISA 570.12–15 · evaluate management's assessment
21period_end=must be ≥12m from FS date
22method=
23key_assumptions=
24data_reliability=
Management's assessment · period + method + data reliability
27// management_plans— ISA 570.16 · feasibility + intent & ability
No plans documented. Add management's plans (asset sale, refinancing, equity raise, cost reduction, etc.) with per-plan feasibility assessment.
Management's plans · feasibility (intent AND ability)
35// cash_flow_stress_test— ISA 570.16(c) · runway scenarios
Enter monthly burn rate to run cash flow stress test.
Cash flow stress test · runway scenarios
45// sensitivity_analysis— what-if additional indicators
Select indicators to run sensitivity.
Sensitivity · what-if indicator escalation
50// risk_heat_map— category × severity
Select indicators to generate heat map.
Risk heat map · category × severity
55// material_uncertainty— ISA 570.18–20 · three-step determination
56basis_appropriate=
is GC basis of accounting appropriate?
57uncertainty_level=
58reasoning=
59stand_back_assessment=
Material uncertainty · three-step determination + stand-back
62// disclosure_adequacy— ISA 570.19 · financial statement note
✓
Going concern basis of accounting is appropriate based on audit evidence obtainedISA 570.19
✓
Material uncertainty (if any) is adequately disclosed in the financial statementsISA 570.20
✓
Principal events or conditions giving rise to doubt are specifically describedISA 570.20(a)
✓
Management’s plans to address the uncertainty are disclosedISA 570.20(b)
✓
Financial statements include explicit statement that material uncertainty existsISA 570.21
✓
Auditor’s report includes ‘Material Uncertainty Related to Going Concern’ sectionISA 570.22
✓
If disclosure is inadequate, a qualified or adverse opinion is consideredISA 570.23
✓
Written representations obtained on going concern assessment completenessISA 580.10(e)
70proposed_disclosure_text=
Disclosure adequacy · ISA 570.19 + proposed text
75// audit_report_decision— ISA 570.21–24 · report form
76report_decision=
77rationale=
tcwg_communication (ISA 570.25)
78
79key_points_communicated=
Audit report decision + TCWG communication
85// isa_570_revised_readiness— effective Dec 2026 · 2024 revisions
✓
Enhanced risk assessment for going concern events and conditions
Structured identification process for events and conditions, applied regardless of initial risk assessment.
✓
Evaluate management’s intent AND ability to execute mitigating plans
Both intent and ability must be separately assessed and documented.
✓
Mandatory going concern section in all auditor’s reports
A dedicated GC section is required even when no material uncertainty exists.
✓
Explicit stand-back assessment at the end of audit fieldwork
Stand back and consider all evidence obtained that is relevant to going concern before forming a conclusion.
✓
Enhanced transparency about going concern work in auditor’s report
Greater detail about procedures performed and conclusions reached.
✓
Professional skepticism documented at each stage, not just in conclusions
Evidence of skeptical questioning of management assumptions must appear throughout working papers.
ISA 570 (Revised) 2024 readiness checklist
awaiting selection·0/21 indicators · score 0private
01weighted_score
total—
02assessment_level
level—
03indicators
selected—
04high_severity
count—
CONTEXTUAL INTELLIGENCE — 1 warning
ℹ ISA 570.10
No indicators identified. ISA 570.10 still requires documentation that going concern was considered. Ensure working papers record the basis for this nil conclusion, including the information sources reviewed.
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Going concern assessment: General

Going concern is the audit area where the partner's signature carries personal exposure. Most teams treat it as a year-end formality. ISA 570 (Revised) does not. The standard wants a separate, documented assessment that runs through the indicators, evaluates management's mitigating plan on its own merits, and concludes — with reasons — whether a material uncertainty disclosure is needed. On most files we review, the indicator review is there. The evaluation of management's plan is where the gap shows up, and that is what regulators pull files for.

Key risk factors: General

ISA 570.A2 splits the indicators into three buckets — financial, operating, and other. Financial is the most cited: net liability position, covenant headroom under 10%, refinancing falling due within 12 months, persistent operating losses. Operating: loss of a major customer accounting for 20%+ of revenue, departure of key management without succession, labour disruption. Other: ongoing litigation with material exposure, regulatory non-compliance with going-concern implications, catastrophic uninsured losses. One indicator alone does not change the conclusion. Three or more in different buckets usually does, and that is the call the standard expects you to document.

Cash flow forecast first, conclusion second. When indicators are present, management's 12-month forecast is the primary evidence. The auditor's job is to test the assumptions — revenue growth, working capital movements, refinancing plans — not to accept the bottom line. Most files we review get this backwards: they accept the forecast and then back-fill the rationale.

Material uncertainty has a higher bar than indicators. Indicators trigger procedures. Material uncertainty triggers disclosure. The threshold under ISA 570.18 is whether the magnitude could affect users' understanding — not whether the entity might fail. The two are not the same and the file should show which test was applied.

Inadequate disclosure is an audit issue even when going concern is appropriate. ISA 570.22-23 spells out what management must disclose when a material uncertainty is identified: the events, the assessment, the plans, and the conclusion. If any of those are missing or fluffy, that is a modification on its own — separate from the going concern conclusion.

12 months from signing, not from balance-sheet date. ISA 570.13 is explicit. On a 31 December year-end with signing in late April, the assessment runs to next April. Most teams default to balance-sheet-date arithmetic and end up with a forecast period that is months too short — easy fix, but only if you catch it at planning.

Frequently asked questions

What are the key going concern risk factors for general?
ISA 570.A2 splits the indicators into three buckets — financial, operating, and other. Financial is the most cited: net liability position, covenant headroom under 10%, refinancing falling due within 12 months, persistent operating losses. Operating: loss of a major customer accounting for 20%+ of revenue, departure of key management without succession, labour disruption. Other: ongoing litigation with material exposure, regulatory non-compliance with going-concern implications, catastrophic uninsured losses. One indicator alone does not change the conclusion. Three or more in different buckets usually does, and that is the call the standard expects you to document.
What should auditors consider when assessing going concern for general?
Cash flow forecast first, conclusion second. When indicators are present, management's 12-month forecast is the primary evidence. The auditor's job is to test the assumptions — revenue growth, working capital movements, refinancing plans — not to accept the bottom line. Most files we review get this backwards: they accept the forecast and then back-fill the rationale. Material uncertainty has a higher bar than indicators. Indicators trigger procedures. Material uncertainty triggers disclosure. The threshold under ISA 570.18 is whether the magnitude could affect users' understanding — not whether the entity might fail. The two are not the same and the file should show which test was applied. Inadequate disclosure is an audit issue even when going concern is appropriate. ISA 570.22-23 spells out what management must disclose when a material uncertainty is identified: the events, the assessment, the plans, and the conclusion. If any of those are missing or fluffy, that is a modification on its own — separate from the going concern conclusion. 12 months from signing, not from balance-sheet date. ISA 570.13 is explicit. On a 31 December year-end with signing in late April, the assessment runs to next April. Most teams default to balance-sheet-date arithmetic and end up with a forecast period that is months too short — easy fix, but only if you catch it at planning.
What is the ISA 570 going concern assessment period?
The going concern assessment must cover at least 12 months from the date the financial statements are expected to be authorised for issue, not from the balance sheet date. This distinction matters: for entities with a long time between year-end and signing, the assessment period may extend significantly into the future.

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