Pressure Mounts for Tougher Audit Warnings on Troubled Companies

International regulators, under rising pressure from shareholders, are considering tighter auditing and disclosure requirements to warn investors about companies at risk of collapse.

The move follows the lead of the U.K.'s accounting watchdog, the Financial Reporting Council, which announced in September that auditors will have to more “robustly challenge” company director statements about why their corporations are unlikely to fold. The heavier requirements on “going concern” statements only applied to the U.K., but the International Auditing and Assurance Standards Board—which sets audit requirements followed by national regulators in Europe and elsewhere—told Bloomberg Tax it could be next in line.

“Going ...