Lords seek explanation on what constitutes “true and fair”
The Financial Reporting Council (FRC) has so far not spoken out about the requests from the House of Lords Economic Affairs Select Committee to explain what constitutes ‘fair & true’.
In a letter dated 29th November 2016 from Lord Holick, chair of the Economic Affairs Committee to FRC Chief Executive Mr Steven Hadrill, the board pressed the Council on its standpoint.
The dispute dates back to 2011, which is mainly surrounding how to the interpret the Companies Act 2006 regarding dividend payments based on accounts prepared under International Financial Reporting Standards (IFRS).
The QC Bompas states that unless the balance sheets show a determination of distributable revenue from the statistics as stated in the accounts, then the accounts will not give a fair and true interpretation of the assets, liabilities; profit or loss, or financial position of organisations, which presents a substantial problem.
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