True and Fair View – The Substitute of “God Redovisningssed”? What has happened to the accounting of the companies that have implemented IFRS in Sweden?

Abstract

Background and Problem: The EU has recently adopted a new regulation that describes the application of common international accounting standards produced by the IASB, which is compulsory within the EU. God redovisningssed is a concept that describes practice in Sweden. The enterprises now have to adapt to the EU’s concept, true and fair view. The last year, 2005, has been the first year for companies to use the new accounting standards. Has the IASB’s true and fair view replaced the Swedish concept god redovisningssed or is god redovisningssed still used as a concept in accounting practice? Aim of the Study: The aim of the study is to examine whether god redovisningssed is still having an impact on accounting in the consolidated public companies or if true and fair view has been fully implemented. Problem Delimitations: The study is limited to discuss the general aspects and definitions of accounting laws and recommendations. Furthermore, the empirical findings are focused on the biggest companies in Sweden. Method: A hermeneutical perspective with a focus on a qualitative method permeates the thesis. Scientific books and scientific articles as well as interviews with six persons who are working closely to the research area, constitute the findings of the study. Analysis and Conclusion: The findings of the thesis state that the concept god redovisningssed is not used in accounting practice in the public consolidated accounts in Sweden today, but there are some aspects stressed by the interviewees, which show a possible impact of god redovisningssed on today’s accounting. As true and fair view takes both the details, as well as the overall picture into consideration, it is a wider concept than god redovisningssed. In conclusion, true and fair view has not been thoroughly used or discussed among the users. Thus, true and fair view has replaced god redovisningssed in theory, but it has not filled the void in practice. Research Suggestions: According to some of the interviewees, clear differences in the implementation of IFRS can be seen between medium-sized companies and big companies. Therefore, it could be interesting to research how these smaller companies have succeeded with the implementation of IFRS and its true and fair view.