Opinion

Going Concern Warnings: Should You Pay Attention?

Baruch Lev

By Baruch Lev

By Baruch Lev

On May 11, 2020, Chesapeake Energy (NYSE:CHK) issued a warning: “Management has concluded that there is substantial doubt about the company’s ability to continue as a going concern.” It further cautioned that the company doesn’t expect to be in compliance with financial covenants.

May 6, 2020, Norwegian Cruise (NYSE:NCLH) announced that there is “substantial doubt about the company’s ability to continue as a going concern, as the company doesn’t have sufficient liquidity to meet its obligations over the next 12 months…”

May 5, 2020, Israel’s biggest energy company, Delek Group (OTCPK:DGRLY), included in its fourth-quarter report an auditor’s warning about the company’s questionable ability to continue operating as a going concern.

Read the full Seeking Alpha article.

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Baruch Lev is the Philip Bardes Professor of Accounting and Finance.