Under CAS/ASPE, going concern assessment period?

Under CAS/ASPE, going concern assessment period?

• A. 6 months
• B. 12 months
• C. 24 months
• D. 36 months

Answer: (B)

The going concern assessment under CAS/ASPE is evaluated with a 12-month horizon from the date the financial statements are authorized for issue. This 12-month window is the standard period management uses to assess whether the entity can continue operations and meet obligations, taking into account cash flow, financing needs, and potential uncertainties. If doubts arise about being able to continue beyond that period, they must be disclosed, and the auditor may highlight the matter. Longer periods (like 24 or 36 months) aren’t the baseline in this context, and a period shorter than 12 months would not align with the standard requirement.

The going concern assessment under CAS/ASPE is evaluated with a 12-month horizon from the date the financial statements are authorized for issue. This 12-month window is the standard period management uses to assess whether the entity can continue operations and meet obligations, taking into account cash flow, financing needs, and potential uncertainties. If doubts arise about being able to continue beyond that period, they must be disclosed, and the auditor may highlight the matter. Longer periods (like 24 or 36 months) aren’t the baseline in this context, and a period shorter than 12 months would not align with the standard requirement.