The ICAEW (Institute of Chartered Accountants in England and Wales) go out of their way not to call going concern anything. And they succeed most of the time. For instance they get around it by using this trick: “Accounts are usually prepared on the basis that the business is a ‘going concern’.” [1] This way…
A basis or a focus However others go right in and announce that going concern is a basis: “An entity prepares financial statements on a going concern basis…” [1] End of discussion, clear and emphatic. But it is the IFRS that uses going concern as a basis the most. In one of their explications they…
Going concern is an assumption in many accounting documents and is the favourite for accountants. Here is an example: “Ordinarily, information that significantly contradicts the going concern assumption relates to the entity’s inability to continue to meet its obligations as they become due…” [1] often with an adjective attached, for instance a fundamental assumption The…
Here are some more ludicrous expressions used by accountants to explain going concern Concept or assumption Many accountants call going concern a concept and then contradict themselves that it is an assumption and not a concept at all. Take the ACCA (The Association of Chartered Certified Accountants) in their global site. They state: “The concept…
Accountants struggle to decide what ‘going concern’ really is. Is it a concept, a principle or a standard? These three are not enough, they have eight different expressions in total to describe going concern here are the other five: an assumption, a basis, a presumption, a focus, an assessment and an accounting term? They cannot…
Going concern what a ludicrous expression accountants have invented. If they think a company will survive in the future they should just say it. But no they have gone out of their way to treat it as a concept give it a stupid name and hide behind the terminology to show how clever they are….
And finally the most boring book in the world mixes fruit and ships together. I must admit, to show my ignorance to the LinkedIn world, that at my age, I did not know what a ‘safe harbour’ was. I discovered it through reading the most boring book in the world. (Note 1) Which only goes…
I found yet another sentence on Page 161 to write about: This one is truly boring but read it anyway but do not try to understand it because it is incomprehensible to us ordinary mortals. “In practice, both quantative and qualitive criteria are used to include or reject potential comparables”. (Note 1) This is another…
“The process followed to identify potential comparables is one of the most critical aspects of the comparability analysis and it should be transparent, systematic and verifiable. In particular, the choice of selection criteria has a significant impact on the outcome of the analysis and should reflect the most meaningful economic characteristics of the transactions compared….
I found another sentence to write about on Page 29 of the most boring book in the world: “Tax administrations should not automatically assume that associated enterprises have sought to manipulate profits” and avoid taxation. (Note 1) This is a silly sentence. Of course, enterprises manipulate profits to pay as little tax as possible. They…