True and Fair View

In British accounting standards, the requirement for companies not to obfuscate their financial statements so as to mislead shareholders or the wider market.

true and fair view

the opinion formed by an AUDITOR about a JOINT-STOCK COMPANY'S accounts, based upon evidence obtained from auditing the company's LEDGER accounts. The auditor is required to report to a company's shareholders about the accuracy and presentation of a firm's annual report and accounts. After undertaking the appropriate tests, usually on a sample basis, the auditor must be convinced that no material errors or omissions have occurred either in the firm's system of recording accounting transactions or in their summary and presentation. If the auditor is satisfied that no material irregularities have occurred, he or she will conclude that the financial statements present a ‘true and fair view’ for the period (year) under review. If irregularities are noted, the accounts may be prefaced with the qualification that ‘subject to the following … the financial statements audited … present a true and fair view’. See also FINANCIAL ACCOUNTING.

References in periodicals archive

The author also hypothesizes that perhaps if Ernst & Young had been subject to a requirement to report whether the financial statements present a "true and fair view" of Lehman, it would not have allowed Lehman to report the Repo 105 transactions as sales.

Troubling points

The Deloitte disclaimer says: "Because of the possible effects of the limitation in evidence available to us, we are unable to form an opinion as to whether the company's individual financial statements give a true and fair view of the state of the company's affairs at December 31, 2004, and of its loss for the year.

"In view of this failure, in our opinion, a true and fair view of the state of affairs of the group as at December 31, 2004, and of the loss to the group for the year then ended has not been given.

Phoenix rap over records; LONGBRIDGE: Accounts failed to give 'true and fair' view

The company's auditors conducted the review in accordance with the recommendation of the Finnish Institute of Authorised Public Accountants and have reached the conclusion that the interim report provides a true and fair view of the financial status of the company.

Sonera's auditors find interim report to be true and fair

Thus, although the audit's overriding objective is formation of an opinion on whether the financial statements give a "true and fair view," the U.K.

In 1987, the true and fair view concept became part of German accounting requirements as a consequence of incorporating the European Union's fourth directive on individual company accounts into company law.

audit reports contain the auditor's opinion on the company's compliance with the Companies Act, as well as an opinion on whether the financial statements give a true and fair view. The opinion paragraph of the U.S.

auditors issue qualified opinions only if there are both a departure from GAAP and an auditor disagreement with the client that either the departure is necessary for the financial statements to give a true and fair view or the departure is not adequately disclosed.

For example, (see exhibit 3, letter C), the German audit opinion on single-entity or consolidated financial statements confirms that the accounting and financial statements comply with the German legal provisions and GAAP, and that the statements give a true and fair view of the company's or group's assets, liabilities, financial position and profit or loss.

Express an opinion on whether the consolidated accounts comply with legal provisions and give a true and fair view of the assets, liabilities, financial position and profit or loss included in the consolidation taken as a whole and whether the consolidated annual report is consistent with the consolidated accounts.

Express an opinion on whether the financial statements have been properly prepared in accordance with the Companies Acts and give a true and fair view.

In our opinion the accounts give a true and fair view of the state of affairs of the company and of the group as at 31 December 1994 and of the profit of the group for the year then ended and have been properly prepared in accordance with the Companies Act of 1985.

International auditing differences