We analyze a sample of UK public entities that invoked a True and Fair View (TFV) override during 19982000 to assess whether overrides are used opportunistically. We find overrides increase income and equity significantly, and firms with weaker performance and higher levels of debt employ overrides that are more costly . . . financial statements are not less informative than control sample.11

Discuss the enquiries and action that you think an auditor should take to ensure that the financial statements give a more true and fair view than from applying standards.

When preparing accounts under Format 1, how would a bad debt that was materially larger than normal be disclosed?

6. Annual accounts have been put into such a straitjacket of overemphasis on uniform disclosure that there will be a growing pressure by national bodies to introduce changes unilaterally which will again lead to diversity in the quality of disclosure. This is both healthy and necessary. Discuss.