David W. Tate, Esq., San Francisco and California – dave@tateattorney.com

In light of COVID-19 and shutdowns you might have been seeing recent discussions about possible business or entity going concern issues (that is, if there is substantial doubt whether they will be remaining as a viable entity within the requisite period of time) and the auditor’s responsibilities relating to those issues. Indeed, I have written blog posts on this issue.

I am passing this along for additional information, i.e., this post is not a full discussion or really even a partial discussion, FASB ASU (Accounting Standards Update) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, provides that under Generally Accepted Accounting Principles (GAAP) management itself also has a responsibility to evaluate whether there is a going concern issue and to make a disclosure if the requisite criteria are met. Now, I readily acknowledge that I will need to read up on ASU 2014-15, but in this time of COVID-19 and shutdowns and other limitations it does seem that management’s evaluation of a possible going concern issue under GAAP might (or might not) become relevant in a variety of situations which might also have legal ramifications (and, by the way, needing to read up on an issue is not uncommon for attorneys, and I am comfortable acknowledging that when appropriate – ASU 2014-15 is 39 pages and has many nuances to it). ASU 2014-15 provides that the amendments in that Update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter, although early application is permitted.

For your information and reading, here is a link to ASU 2014-15: https://www.fasb.org/jsp/FASB/Document_C/DocumentPage?cid=1176164329772&acceptedDisclaimer=true

Best to you, Dave Tate, Esq. (San Francisco and California) – dave@tateattorney.com

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Remember, every case and situation is different. It is important to obtain and evaluate all of the evidence that is available, and to apply that evidence to the applicable standards and laws. You do need to consult with an attorney and other professionals about your particular situation. This post is not a solicitation for legal or other services inside of or outside of California, and, of course, this post only is a summary of information that changes from time to time, and does not apply to any particular situation or to your specific situation. So . . . you cannot rely on this post for your situation or as legal or other professional advice or representation.

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Best to you, David Tate, Esq. (and inactive California CPA) – practicing in California only.

I am also the Chair of the Business Law Section of the Bar Association of San Francisco.

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My law practice primarily involves the following areas and issues:

Trust, Estate, Probate Court, Elder and Dependent Adult, and Disability Disputes and Litigation

• • • Trust and estate disputes and litigation, and contentious administrations representing fiduciaries, beneficiaries and families; elder abuse; power of attorney disputes; elder care and nursing home abuse; conservatorships; claims to real and personal property; and other related disputes and litigation.

Business, Business-Related, and Workplace Disputes and Litigation: Private, Closely Held, and Family Businesses; Public Companies; Nonprofit Entities; and Governmental Entities

• • • Business v. business disputes including breach of contract; unlawful, unfair and fraudulent business practices; fraud, deceit and misrepresentation; unfair competition; licensing agreements, breach of the covenant of good faith and fair dealing; etc.
    • Misappropriation of trade secrets.
    • M&A disputes.
    • Founder, officer, director and board, investor, shareholder, creditor, VC, control, governance, decision making, fiduciary duty, conflict of interest, independence, voting, etc., disputes.
    • Buy-sell disputes.
    • Funding and share dilution disputes.
    • Accounting, lost profits, and royalty disputes and damages.
    • Insurance coverage and bad faith.
    • Access to corporate and business records disputes.
    • Employee, employer and workplace disputes and processes, discrimination, whistleblower and retaliation, harassment, defamation, etc.

Investigations, Governance, and Responsibilities and Rights

• • • Corporate, business, nonprofit and governmental internal investigations.
    • Board, audit committee, governance committee, and special committee governance and processes, disputes, conflicts of interest, independence, culture, ethics, etc.; and advising audit committees, governance committees, officers, directors, and boards.

Mediations and Services as a Mediator

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