Going concern note examples

Key facts

As at 25 October 2026.

Example 1: going concern, no material uncertainty

The directors have prepared the financial statements on a going concern basis. They have reviewed the company's forecasts and cash flow projections, which take account of reasonably possible changes in trading, and its bank facilities, which are available until [date]. On that basis the directors expect the company to have adequate resources to continue in operation and to meet its liabilities as they fall due for the foreseeable future. In reaching this conclusion the significant judgement was [for example, the renewal of the main customer contract in [month]].

Example 2: going concern, with a material uncertainty

The company made a loss of £[amount] in the year and at 31 December 2026 its current liabilities exceeded its current assets by £[amount]. Its bank overdraft facility of £[amount] is due for renewal on [date] and the bank has not yet confirmed the renewal. The directors expect the facility to be renewed and have prepared forecasts showing that the company can operate within it, so they have prepared the financial statements on a going concern basis. These conditions indicate the existence of a material uncertainty which may cast significant doubt on the company's ability to continue as a going concern. The financial statements do not include the adjustments that would result if the company were unable to continue as a going concern.

Example 3: not a going concern

On [date] the directors decided to cease trading and to [sell the company's assets and settle its liabilities / place the company into members' voluntary liquidation]. The financial statements have therefore not been prepared on a going concern basis. [Describe the basis used, including how the assets and liabilities are measured.]

What the 2026 rules require

• The basis used, normally the going concern basis, with confirmation that the directors considered the future, and any significant judgements they made in concluding.
• Material uncertainties related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern.
• If the accounts are not prepared on a going concern basis, that fact, the basis used and the reason.

For periods beginning before 1 January 2026 these disclosures were encouraged for UK small entities rather than required; most accounts included them anyway. From 2026 the encouraged list in Appendix E applies only to entities in the Republic of Ireland, and the UK items moved into the required Appendix C.

Writing a useful note

• Make it specific: name the facility, the contract or the forecast the conclusion rests on. A note that could belong to any company tells the reader nothing.
• Match the rest of the accounts: a material uncertainty in the note should be visible in the figures and, where there is one, in the directors' report.
• Explain the judgements: from 2026 the note must set out the significant judgements the directors made in concluding (FRS 102 3.8A).
• Software can draft the wording from the facts you give it; the conclusion is the directors' judgement.

The going concern policy fits with the other policies in the accounting policies example and the board's consideration is recorded in the board minute.

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