What is fair presentation

What is fair presentation?

The financial statements must present fairly the:

1. Financial position
2. Financial performance and 
3. Cash flows of an entity

This requires the faithful representation of

1. The effects of transactions and other events, in accordance with the definitions and recognition criteria for assets, liabilities, income and expenses, 
2. As set out in the Conceptual Framework for Financial Reporting (Conceptual Framework). 
3. The application of International Financial Reporting Standards is presumed to result in a fair presentation.

To achieve a fair presentation, entities are required to:

1. Select and apply accounting policies in accordance with
2. IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors

Present information, including accounting policies, in a manner that provides

1. Relevant
2. Reliable
3. Comparable and
4. Understandable information

Provide additional disclosure when

1. Compliance with the specific requirements in the relevant accounting standard(s) is insufficient
2. To enable users to understand the impacts of particular events and transactions on the entity’s financial position and performance

Who cares?

Auditors.

Anyone that makes a decision based on the GPFR.

You, if your GPFR are intentionally misleading, you are being deceptive or committing fraud.