True View and Fair Presentation Essay Example | Topics and Well Written Essays - 2000 words

True View and Fair Presentation - Essay ExampleCountries wish UK, EU, Singapore, Australia, and new-sprung(prenominal) Zealand have opted to adopt the true and fair view, whereas United States preferred to adopt GAAP standards. (Hopwood, Page, & Turley, 1990) While Present fairly in accordance with GAAP took its origin from the US financial coverage regulations in 1939 (McEnroe & Martens, 1998), UK Companies Act 1947 introduced the concept of True and Fair View for the first time in the UK. (Parker & Nobes, 1994) However the latest version of the International Accounting Standard - 1 (IAS 1) which became functional on or after 1st July 1998 recommends the adoption of both the reporting standards. IAS - 1 requires a fair presentation and disclosure in compliance with the IAS and in cases where there is a misleading element in the compliance to the IAS, the reporting whoremaster adopt a limited true and fair view to override the fair presentation. (IAS 1, 1998) This written repor t examines whether the fair presentation requirements of IAS - 1 undermine the UKs adoption of the view of true and fair in the reporting of the financial statements.There is no authoritative exposition of the term true and fair view and some of the approaches to the definition have considered the concept in relation to the individual components of the terms in isolation. (Cowan, 1965) Chastney (1975) suggests that either of the terms does not presuppose the other and the also doubts whether the combined egress of the term amounts to more than the effect of the individual terms. Parker and Nobes (1991) found that majority of the auditors had made a distinction between both the terms true and fair. They also concluded away of their survey on the UK Directors that most of the directors considered both terms are synonymous. Both the terms true and fair have been defined in a precise and exact manner. The record of truth, whether it is absolute or relative, whether it exists as a re ality, an incontrovertible thing, or as an abstraction, whether it is dependent or independent of the believer/observer and whether any statement can be proven or merely falsified are all aspects that that have been applied to news report theory and research. (Covaleski & Dirsmith, 1990 Chua, 1986)Meaning of Fairly Presented, In Accordance with GAAP Just like the terms true and fair view there is no precise definition available of the term present fairly in accordance with GAAP which can be considered as the American Equivalent of true and fair view. Mano et al (1996) observe that the term may meanThe reports presented fairly and also in accordance with the generally accepted accounting principles