Continuity concept

                                                                                                                                     

MBA

Accounting for Managers

ASSIGNMENT

 

Course Code: MMPC-004

Assignment Code: MMPC-004/TMA/JULY/2022 

Coverage : All Blocks

1. Explain the following accounting concepts

(c) Continuity concept

The continuity concept, also known as the going concern concept, is a fundamental accounting principle that assumes that a business will continue to operate indefinitely, and that its financial statements should be prepared under this assumption. According to this concept, a business is considered to be a going concern, unless there is evidence to the contrary. 

The continuity concept is based on the idea that a business is an ongoing entity with a long-term perspective, and that its financial statements should reflect this. This means that the financial statements of a business are prepared with the assumption that the business will continue to operate in the foreseeable future, and that it will be able to meet its obligations and commitments as they come due.

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