Auditors’, bankers’ and insolvency practitioners’ “going‐concern” opinion logit model Available to Purchase

“Going‐concern” opinions are judgemental and therefore fraught with numerous problems. The inability to establish the “correctness” or otherwise of the “going‐concern” opinion decision has also been puzzling practitioners throughout the years. Exploratory interviews revealed that a “going‐concern” opinion decision involves not only auditors but also bankers and insolvency practitioners particularly under conditions of financial distress. The purpose of this paper is to determine the factors influencing “going‐concern” opinion decisions of auditors, bankers and insolvency practitioners (IPs) for financially distressed client‐firms. Using data collected via a postal questionnaire, a logistic regression model is developed with an overall correct classification of 81.11 per cent. The model uses indicators of “going‐concern” uncertainties and events/action triggers that invalidate the “going‐concern” status of a financially distressed firm. Further research examining the impact of other (behavioural) factors is required but also highlighting any differences between these three professional user groups of company accounts.