Question

When should auditors generally assess a client's ability to continue as a going concern?

A) upon completion of the audit
B) during the planning stages of the audit
C) throughout the entire audit process
D) during testing and completion phases of the audit

Answer 1

Auditors generally assess a client's ability to continue as a going concern during the planning stages of the audit.

Step-by-step explanation:

When conducting an audit, auditors generally assess a client's ability to continue as a going concern during the planning stages of the audit.

This assessment is important as it helps auditors identify any potential risks or uncertainties that may affect the client's ability to operate in the future.

By assessing a client's ability to continue as a going concern early on, auditors can tailor their audit procedures and gather sufficient evidence to provide an opinion on the client's financial statements.