Garvey, Anne Marie and Parte, Laura and McNally, Bridget and Gonzalo-Angulo, José Antonio
(2021)
True and Fair Override: Accounting Expert Opinions, Explanations from Behavioural Theories, and Discussions for Sustainability Accounting.
Sustainability, 13 (4).
p. 1928.
ISSN 2071-1050
Abstract
This study focuses on true and fair view (TFV) and fair presentation (FP) in financial
statements. It questions if attitudes towards the true and fair override (TFO) condition, included in
European Union (EU) legislation and International Financial Reporting Standards (IFRS), is indicative
of a principles-based approach or lip service to a concept that is rarely applied. We address this
subject because we consider that there should be a consensus and harmonisation on TFV—that
TFO has a vital role within the principles-based framework, and while the accounting standard
development process should limit the application of the TFO concept, in practice, it is an important
reporting option. TFV/TFO harmonisation also has an important role in sustainability accounting,
to reveal company actions which are influenced by more than just the objective of complying with
the standards. In the empirical part, accounting experts from 24 European countries were surveyed.
Their responses suggest a lack of clarity around the distinction between TFV and FP and a reluctance
to consider, in practice, the application of the TFO. Drawing on behavioural theories—ostrich effect
and comfort theory—we find explanations and reasoning behind attitudes to these cornerstone
concepts. Specifically, we try to explain behavioural attitudes to TFV/FP and TFO positions, which
defend uncompromising compliance with standards.
| Item Type: |
Article
|
| Keywords: |
true and fair view; fair presentation; override; survey; sustainability; IFRS; ostrich effect;
comfort theory; |
| Academic Unit: |
Faculty of Social Sciences > School of Business |
| Item ID: |
18332 |
| Identification Number: |
https://doi.org/10.3390/su13041928 |
| Depositing User: |
Bridget McNally
|
| Date Deposited: |
28 Mar 2024 13:57 |
| Journal or Publication Title: |
Sustainability |
| Refereed: |
Yes |
| URI: |
|
| Use Licence: |
This item is available under a Creative Commons Attribution Non Commercial Share Alike Licence (CC BY-NC-SA). Details of this licence are available
here |
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