Going Concern Checklist for Technology Startups
Tailored going concern assessment for technology startups and scale-ups. Covers industry-specific indicators including cash runway, funding pipeline, burn rate trajectory, and revenue milestone achievement.
Engagement context
Set the entity details for your working paper. The assessment period is calculated per ISA 570.3.
Indicators
Check all indicators that apply to the entity. 21 indicators from ISA 570.A2/A7 including ISA 570 (Revised 2024) additions. Expand any indicator to see working paper guidance and the likely review challenge.
ISA 570 Going Concern Reference Card: free PDF
One page for your planning folder: the indicator severity matrix, ISA 570.3 assessment period checklist, draft MURGC paragraph, ISA 570.16–.19 evidence requirements, and a summary of the key ISA 570 (Revised 2024) changes effective December 2026. Plus one practical audit insight per week.
No spam. We're auditors, not marketers.
How the score works
Each indicator is weighted by severity: High = 3 points, Medium = 2 points, Low = 1 point.
Assessment levels are determined by two criteria (whichever is met first):
- Substantial doubt: ≥2 high-severity indicators OR weighted score ≥8
- Significant concern: ≥1 high-severity indicator OR weighted score ≥4
- Limited concern: Weighted score ≥1
- No indicators: Score = 0
The 21 indicators are sourced from ISA 570.A2 (current) and ISA 570 (Revised 2024) A7, covering financial, operating, and other categories.
This scoring is a starting point for professional judgment. The auditor must consider entity-specific circumstances, industry context, and the collective effect of indicators when forming a conclusion.
ISA 570.9: The auditor shall evaluate management's assessment of the entity's ability to continue as a going concern.
ISA 570.A2/A7: Events or conditions that may cast significant doubt include financial, operating, and other indicators.
ISA 570.16: If events or conditions have been identified, the auditor shall obtain sufficient appropriate audit evidence about whether a material uncertainty exists.
Going concern assessment: Technology Startups
Technology startups operate in a fundamentally different going concern paradigm from established businesses: they are expected to burn cash. The going concern assessment is not about profitability but about whether the entity has sufficient runway to reach the next funding milestone, achieve profitability, or otherwise sustain operations. This makes cash runway analysis and funding pipeline assessment the central focus.
Key risk factors: Technology Startups
Key technology startup going concern indicators include: cash runway of less than 12 months without committed additional funding, failure to achieve key product or revenue milestones required for the next funding round, declining venture capital market conditions making fundraising uncertain, unsustainable customer acquisition costs (CAC) relative to customer lifetime value (LTV), key employee departures that could delay product development or undermine investor confidence, and absence of a credible path to profitability or further funding.
Cash runway calculation — this is the single most important assessment. Calculate months of cash remaining at the current burn rate, and also at an accelerated burn rate if growth investment is continuing.
Funding pipeline — assess whether the next funding round is committed, in term sheet stage, or purely speculative. Only committed funding (signed term sheets with closing conditions substantially met) should be treated as probable.
Burn rate trajectory — is the monthly cash burn increasing, stable, or decreasing? An increasing burn rate shortens runway faster than a linear projection suggests.
Revenue milestone achievement — many startups need to demonstrate traction (ARR targets, user growth, unit economics) to secure the next funding round. Assess whether these milestones are achievable.
Customer concentration — early-stage companies often depend on a small number of early adopters. Loss of one or two key customers can simultaneously destroy revenue and undermine the fundraising narrative.
Management's contingency plans — what can management actually cut to extend runway? Assess the credibility of cost reduction scenarios and whether they would impair the business beyond recovery.