Glossary · Reading the business
Going concern
In short
An accounting assumption that a business will continue to operate indefinitely and not be forced to liquidate its assets. It's fundamental to how financial statements are prepared.
What it means in a deal
When you're buying a business, you're buying a "going concern" – an operational entity meant to continue generating revenue. Lenders assess the business's ability to remain a going concern, looking at its Cash flow and overall financial health to ensure it can repay the SBA loan. If there's a "going concern" qualification in an audit, it's a major red flag.
Related terms
Common questions about Going concern
- What if a franchise agreement contains provisions for indemnification that concern the SBA?
- What if the acquired business's real estate has an environmental concern requiring remediation?
- What is the purpose of the annual service fee (on-going guaranty fee) for an SBA 7(a) loan?
- How does the SBA calculate the annual service fee (on-going guaranty fee) charged to the lender for a 7(a) loan?
- What if the acquired business property has existing environmental concerns, like old fuel tanks?
- What are a lender's responsibilities concerning the proper use of 7(a) loan proceeds by the borrower?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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