12-month look-forward liquidity assessment. Inputs: cash + credit + burn + debt + covenant cushion + qualitative red flags. Output: classification (No SD / Doubt / Substantial Doubt) with disclosure language and remediation roadmap.
Liquidity inputs
12-month look-forward window per ASC 205-40-50-3
Including restricted cash available for operations
Committed, no MAC clauses tripped
Trailing 3-month average operating outflow
Signed term sheets, board-approved raises, remaining ATM capacity
Working capital and debt
Debt maturity within look-forward window + covenant headroom
Including convertible notes maturing, balloon payments
Headroom on tightest covenant; 0 if breached or no debt
Qualitative red flags
Conditions auditors weigh under PCAOB AS 2415.06
Honest limits: This tool applies the quantitative ASC 205-40 framework only. Actual conclusions require probability-weighted cash flow scenarios (base/upside/downside), management plan effectiveness assessment under the "probable" threshold, subsequent event analysis, board approval, written technical memo, and auditor concurrence. Mitigating plans like signed term sheets or covenant waivers materially change the outcome and cannot be detected by a calculator. Use as a screen, not as the formal evaluation. For hands-on support on going concern memos: rohit@unfoldingvalues.com.