The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date of issuance of the entity’s financial statements. Further, an entity must provide certain disclosures if "conditions or events raise substantial doubt about [the] entity’s ability to continue as a going concern."

The IASB had a similar project on its agenda that sprang from submissions to the IFRS Interpretations Committee. However, the IASB has not been able to complete the project quickly; opinions voiced ranged from the belief that amendments are urgently needed to the belief that all necessary requirements are already included in IFRSs and just need to be applied consistently. The project has been discontinued, but the IASB intends to discuss the issues as part of its disclosure initiative.

The FASB's ASU applies to all entities and is effective for annual periods beginning after 15 December 2015, and interim periods thereafter, with early adoption permitted.

For more information, see our related Heads Up as well as the press release, ASU and FASB in Focus newsletter on the FASB’s website.