Читать книгу Auditing Employee Benefit Plans - Josie Hammond - Страница 73

When the plan sponsor encounters financial adversities, plan management may also need to evaluate whether such adversities raise substantial doubt about the plan’s ability to continue as a going concern.

FASB ASC 205-40 requires management to assess an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or available to be issued). If it is determined that there is substantial doubt about the plan’s ability to continue as a going concern, the mitigating effect of management’s plans should be considered only to the extent it is probable the plans will be effectively implemented and mitigate the conditions or events giving rise to substantial doubt. Certain disclosures are required when substantial doubt is alleviated as a result of consideration of management’s plans. An explicit statement in the notes to the financial statements is required that there is substantial doubt, as well as other disclosures when substantial doubt is not alleviated.