Other bizarre statements on going concern
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 they do not fall into the trap of writing ‘going concern basis’ which others use. But they fail miserably in their document entitled ‘The Going Concern Hub: where to start.’ [2] Here, in the title, they call going concern a ‘hub’ and then in the first paragraph of the document when they call going concern a ‘fundamental bedrock.’ This increases the number of different terms accountants use to describe going concern from eight to ten different, and adds to the confusion they like to spread about it.
However the champion in describing going concern must go to the ACCA where they manage in a few words to make going concern three things at the same time. Take this statement:
“The concept of going concern
An entity prepares financial statements on a going concern basis when, under the going concern assumption…” [3]
In 21 words going concern is a concept, a basis and an assumption. All three! How about that?