Multiple choice

Statements of Standard Accounting Practice and Financial Reporting Standards should be complied when preparing the final accounts of a limited company because ____________.

  1. the Companies Act 1985 demands that they are used

  2. the auditors will insist they are followed

  3. the directors are under a legal obligation to ensure they are followed

  4. they ensure that the accounts present a ‘true and fair view’

  5. all of these
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Directors must prepare accounts,  which give a true and fair view; it is accepted that compliance with accounting standards is necessary to assist in this objective.

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