Material Weakness

Accounting is full of little phrases that seem innocuous on the surface, but actually contain great significance. "Going concern warning" is one of them. "Material weakness" is another.

It may not sound like much, but say "material weakness" in a room full of accountants...and watch them gasp and hold their hands in front of their mouths in worry and chagrin.

The phrase refers to a deficiency in a company's internal financial controls. Basically, it means the company didn't do a good enough job looking over its books. Because of this, there's a good chance that the firm's previous financial statements are (gasp) wrong.