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The term "going concern" in accounting refers to the assumption that a company will continue to operate for the foreseeable future without the intention or necessity of liquidating its assets or significantly curtailing its operations. This assumption is fundamental in the preparation of financial statements; it impacts how assets and liabilities are valued and reported. Under this premise, companies can capitalize expenses and carry assets on the balance sheet without immediate concerns about their ability to meet obligations, as they are expected to generate revenue over time to sustain their operations. If a company were not a going concern, it would need to prepare its financial statements in a different manner, often leading to a more conservative approach that reflects potential liquidation values rather than continued operational values. This differentiation is critical for stakeholders, including investors and creditors, who rely on the assumption of ongoing operations to assess the company's financial health and future prospects.