Monday, 24 June 2013

UK: IFRS, the 'true and fair' view and the Companies Act 2006

Im 2011, the Financial Reporting Council published a paper in which it reiterated the importance of the 'true and fair' requirement under IFRS and UK GAAP: see here (pdf). In doing so, the FRC relied heavily upon a legal opinion written in 2008 by Martin Moore QC: see here (pdf). A more recent legal opinion, prepared by George Bompas QC at the request of a group of investors including the Local Authority Pension Fund Forum, raises questions about the FRC's position and calls for Mr Moore's opinion to be reconsidered: see here (pdf). Mr Bompas concludes his opinion: "It is unsatisfactory that, in such a fundamental matter as the goal to be reached by those producing statutory accounts, there should be any possible confusion as to the goal. For reasons given in this Opinion I believe that there is that possible confusion".

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