Concepts Associated with the ‘True and Fair View’: Evidence from Singapore

Abstract

This study investigated the differential perceptions of the ‘true and fair view’ among accountants, bank officers and managers in Singapore and examined whether ‘true and fair’ was perceived to mean compliance with GAAP and compliance with legal requirements. The survey questionnaire required respondents to evaluate simultaneously 12 phrases (including the ‘true and fair view’) using the card-sorting technique. The questionnaire was given to 300 accountants, 100 bank officers and 200 managers, yielding response rates of 73%, 64% and 81.5% respectively, and 74.33% (or 446) overall. Descriptive statistics, individual differences scaling analysis (INDSCAL) and cluster analysis were performed to analyse the data. The results showed that perceptions of the true and fair view did not differ significantly across the three groups. Further, ‘true and fair’ was clearly distinguished from compliance with GAAP and/or legal requirements. Instead, it was grouped with ‘not misleading’, ‘absence of material errors’ and ‘objective and free from bias’.