Spanish Auditors and the 'True and Fair View'

Economics Working Paper 409

22 Pages Posted: 13 Jan 2000

See all articles by Oriol Amat

Oriol Amat

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences

John Blake

Independent

Ester Oliveras

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences

Abstract

In 1990 a new Spanish 'Plan General de Contabilidad' (PGC) implemented the requirements of the EU 4th and 7th Directives in Spain. Included in the PGC is the requirement, derived from the 4th Directive, that accounts should present a 'true and fair view', in Spanish 'imagen fiel'. Where the term has been used in English speaking jurisdictions it has proved to have a variety of shades of meaning, and to have had strikingly different impact in different countries. Within the European Union the term has been seen as a 'Trojan horse', inserted into the 4th Directive to inject an Anglo-Saxon approach of flexibility and judgement dependent accounting into a Continental European accounting tradition of detailed prescription and uniformity. In this paper we report on a survey of the views and experience of Spanish auditors relating to 'imagen fiel'. Specifically, we:

1) Review the English language literature on 'true and fair view' to identify the key areas of controversy. 2) Consider the significance of the 'true and fair view' within the EU 4th Directive. 3) Report on the experience of Spanish auditors in working with this concept, their views on the value of the term, and their experience in use of the true and fair view 'override'.

JEL Classification: M41, M49

Suggested Citation

Amat, Oriol and Blake, John and Oliveras Sobrevias, Ester, Spanish Auditors and the 'True and Fair View'. Economics Working Paper 409, Available at SSRN: https://ssrn.com/abstract=199062 or http://dx.doi.org/10.2139/ssrn.199062

Oriol Amat (Contact Author)

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences ( email )

Ramon Trias Fargas 25-27
Barcelona, 08005
Spain
+34 93 542 16 55 (Phone)
+34 93 542 17 46 (Fax)

John Blake

Independent

Ester Oliveras Sobrevias

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences ( email )

Ramon Trias Fargas 25-27
Barcelona, 08005
Spain
+34 93 542 16 73 (Phone)
+34 93 542 17 46 (Fax)

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