76. Accurate and timely financial reports and accounts of companies are essential to the functioning of the economy. They are relied upon by lenders, investors and all other stakeholders in a business. One of the fundamental concepts of accounting is that accounts are prepared on a true and fair basis. The Companies Act 2006 states that company directors must not approve accounts unless they are satisfied they give a true and fair view of the assets, liabilities, financial position and profit or loss of the company.269 In turn, the auditor gives an opinion as to whether the accounts are true and fair and free from material misstatement.
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269 Companies Act 2006, section 393