ACCA BT Syllabus C. Business Functions, Regulation and Technology - Basic Legal Requirements - Notes ^{1 / 10}

Accountability refers to the state of being accountable, liable or answerable for actions and conduct.

In most countries there will be a government department set up to oversee the regulation and accounts of companies.

Thus, companies in a particular country are accountable to this government department.

In the UK, this government department (regulatory body) is Companies House.

Most countries have a law which governs the preparation of financial statements.

The name of this law varies from country to country, as does the content.

The companies’ legislation in many commonwealth countries is based on the UK Companies Act.

The Companies’ Acts in the UK require that financial statements are prepared which give a true and fair view, that is, they follow accounting standards, follow generally-accepted best practice and have information of sufficient quantity (adequately detailed) and quality (reasonably accurate) to satisfy the reasonable expectations of the users.

Under companies’ legislation, directors are responsible for producing financial statements which give a true and fair view.