The Auditing Standards Board
(ASB) of the American Institute of CPAs
(AICPA) has issued Statement on Auditing Standards (SAS) No. 126, The Auditor’s Consideration of an Entity’s Ability to Continue as a Going Concern (Redrafted). The SAS replaces SAS No. 59, The Auditor’s Consideration of an Entity’s Ability to Continue as a Going Concern, as amended (AICPA, Professional Standards, AU sec. 341 and AU-C sec. 570). SAS No. 126 is part of the AICPA’s Clarity Project
to standardize the standards which are effective for calendar year 2012.
SAS No. 126 does not change SAS no. 59, as amended, in any significant way. The change makes the SAS format consistent with other recent issued SASs. The ASB, however, delayed convergence with International Standard on Auditing 570, Going Concern, to allow the Financial Accounting Standards Board
to complete the development of accounting guidance addressing going concern.
SAS No. 126 is effective for audits of financial statements for periods ending on or after Dec. 15, 2012.