Economic Pressures Intensify for Australian Companies
On 8 April 2026, a new report revealed that auditors are issuing more ‘going concern’ warnings for Australian businesses now than during the peak of the COVID pandemic. The report, ‘Insights into 2025 Auditor Reports: A Focus on Going Concern’, was released by Chartered Accountants Australia and New Zealand (CA ANZ) in partnership with the Universities of Melbourne and Queensland.
In 2025, 28% of Australian listed companies outside the mining sector were flagged for going concern uncertainty, rising from 20% in 2021. Among mining companies, nearly 50% faced these warnings, up from 32% in 2021. This reflects the cumulative impact of global trade uncertainty, market volatility, higher interest rates, and persistent inflationary pressures on business viability.
Amir Ghandar, CA ANZ Report and Assurance Leader, highlighted, “Auditors are now flagging greater uncertainty than during the pandemic itself, which shows how sustained economic pressures around liquidity, refinancing, and future profitability can be just as challenging for businesses as an acute shock.”
Industries Under Stress
Particularly affected sectors include information technology, health care, and materials. These industries often involve capital-intensive business models, rely on future growth, or face volatile input costs. According to the report, these are sectors where access to funding, confidence in future earnings, and the ability to absorb cost shocks really matter.
Global trade uncertainty, market volatility, higher interest rates, and persistent inflationary pressures contribute significantly to these economic challenges. The report shows a clear size effect, with smaller and growth-stage companies more likely to encounter going concern uncertainty. Tighter funding conditions and elevated borrowing costs have left these entities exposed.
Auditors are drawing attention to conditions that could threaten a company’s ability to continue operating, urging businesses to address these risks. Ghandar emphasised, “High-quality audits are more important than ever in helping capital flow to where it can be used productively and responsibly.” These audits provide nuanced, transparent information that helps investors, lenders, and the wider market understand both the strengths of a business and the risks it faces.
As economic conditions remain challenging for many businesses, the role of financial statements becomes crucial. They are appropriately prepared, but auditors are pointing out that certain conditions could threaten a company’s ongoing operations if not addressed.
