The Financial Accounting Standards Board (FASB), mindful of the large number of business failures that occurred in the wake of the financial crisis, has decided to revisit a controversial decision regarding the reporting of any "substantial doubts" about a public company's ability to continue as a "going concern." Traditionally, outside auditors have been responsible for sounding the alarm if there was doubt a company could continue to operate. But in 2008, FASB proposed requiring management to assess and report on that risk.

In comment letters at the time, the idea was criticized by two different contingents. Some critics opposed putting the responsibility on managers, and others warned that auditors would find it difficult to require management to make such an assessment if the company's own accountants had not already raised the issue. In the end, FASB opted to leave the responsibility with the auditor.

Now a number of members of the accounting board have called for the issue to be reopened. At a May FASB meeting, board member Larry Smith, who previously opposed requiring management to report on going concern risks, said his views had "changed."

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