Resumen
Because of asymmetric payoffs to the auditor, bankrupt local governmental units are unlikely to receive going concern audit opinions (GCOs). To increase this likelihood¸ we propose a framework to increase the evidence to support this opinion. We then apply this to 400 California School District reports, 54 of which were used to declare bankruptcy by 2008. Typically, because of the impending bankruptcy, otherwise reliable State financial information becomes unreliable. We address this and then recommend a GCO in 2008 for thirteen of nineteen districts which eventually went bankrupt. We confirm as available: 1) the missing evidence and provide, and 2) an improved information model demanded by auditing research and practice.