South African businesses with audited financial statements should begin preparing for stronger going-concern scrutiny. The International Auditing and Assurance Standards Board (IAASB) has included ISA 570 (Revised 2024), Going Concern, in its 2026 Handbook. The revised standard is effective for audits of financial statements for periods beginning on or after 15 December 2026. IAASB’s 2026 Handbook announcement confirms the timing and inclusion of the standard.
This is not a new tax rule or a general requirement for every SME to obtain an audit. It is an auditing-standard development that affects entities whose financial statements are subject to an audit performed under the applicable International Standards on Auditing. However, management’s records and forecasts will be central to the auditor’s assessment.
What is changing?
The revised standard strengthens the auditor’s work in evaluating management’s assessment of whether the business can continue as a going concern. The IAASB says the changes include more robust and timely risk assessment, greater attention to management bias and stronger transparency in communications and reporting about going-concern matters. The IAASB’s standard-setting announcement provides the confirmed effective date and broad areas of change.
In practical terms, a general statement that the business is expected to continue may not be enough. Management should be able to show how it reached that conclusion, which assumptions were used and how the business would respond if conditions deteriorate.
Who is affected?
The immediate impact falls on companies requiring an audit, their directors, audit committees and finance teams. It is also relevant to groups preparing consolidated financial statements, businesses with material borrowings, and entities facing liquidity pressure, customer concentration, covenant risks or significant operating losses.
SAICA has highlighted ISA 570 (Revised 2024) as a current audit and assurance topic for management and those charged with governance. SAICA’s October 2026 resource points to the importance of management understanding the implications before implementation begins.
What businesses should check
- Whether monthly management accounts agree to the underlying accounting records.
- Whether the cash-flow forecast covers an appropriate period and is updated for current trading conditions.
- Whether forecasts are supported by realistic assumptions about sales, collections, costs, funding and capital expenditure.
- Whether downside scenarios have been modelled, including delayed customer payments, lost contracts, rising costs or reduced access to finance.
- Whether loan agreements, financial covenants and repayment dates have been reviewed.
- Whether plans to address liquidity risks are documented and supported by evidence.
Practical next steps
Businesses should not wait until the audit starts. Finance teams can prepare by introducing a formal monthly going-concern review, retaining evidence for significant forecast assumptions and documenting the decisions taken by management and directors.
Where uncertainty exists, obtain accounting and audit-readiness support early. A well-supported forecast will not remove commercial risk, but it can help management identify problems sooner and give the auditor a clearer basis for evaluating the company’s plans.
For assistance with management accounts, forecasting and financial controls, explore Your Financial Partner’s accounting and advisory services.
