Going Concern general comments and alternative to the going concern under IFRS

Details

Supervisors

Stempnierwsky, Yvan

Faculty

Louvain School of Management

Degree label

Master [120] en sciences de gestion, à finalité spécialisée

Abstract

This thesis examines the application of International Financial Reporting Standards (IFRS) to entities no longer operating under the "going concern" assumption. It highlights the limitations posed by existing standards, primarily designed for continuity, and explores alternative accounting approaches when entities face discontinuity or liquidation. Using IAS 8 as a framework, the study evaluates modifications through other accounting standards (BGAAP, LuxGAAP, USGAAP) and audit practices, emphasizing the importance of asset revaluation, liability adjustments, and transparent disclosures. A case study of FNG will be used to demonstrate practical adaptations under IFRS during financial distress. The findings reveal significant gaps in IFRS guidance for entities in discontinuity. This underscores the need to have more flexible and comprehensive standards to ensure transparent, reliable financial reporting. This research contributes to the discourse on enhancing IFRS to better address the complexities of financial reporting for distressed entities, while acknowledging limitations such as its focus on a single case study and specific accounting standards.