The reintroduction of the true and fair override and harmonization with IASC standards in Australia

Lessons from the EU and implications for financial reporting and international trade

Alan S. Dunk*, Alan Kilgore

*Corresponding author for this work

Research output: Contribution to journalArticle

7 Citations (Scopus)

Abstract

Two issues currently facing Australia having implications for financial reporting and trade are first, calls for the reintroduction of the true and fair view (TFV) override and second, the move to harmonize Australian accounting standards with those of the International Accounting Standards Committee (IASC). The purpose of the article is to examine the likely effects of such moves given the increasing globalization of both financial and product markets. The conclusions of the article suggest first, a reintroduction of the TFV override would be consistent with its role in the Fourth Directive as the fundamental principle of financial reporting. Second, harmonization with IASs by default will allow an override, as IAS 1 now provides for one. Third, Australia's harmonization of financial reporting requirements with the wider global community may be impeded because of inconsistencies between IASs, US GAAP, and EU Directives. Hence, the proposed reintroduction of the TFV override together with IASC reporting is unlikely to enhance Australia's link to the wider global community, leading to potential negative consequences in both financial and product markets.

Original languageEnglish
Pages (from-to)213-226
Number of pages14
JournalInternational Journal of Accounting
Volume35
Issue number2
Publication statusPublished - 2000

Keywords

  • Accounting directives
  • Harmonization
  • Internationalization
  • Override
  • True and fair view

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