What are the responsibilities of the directors of a company in relation to a company‘s financial statements?

Auditing and Assurance Revision Questions and Answers

i. It is the directors‘ duty to prepare financial statements which show a true and fair view of the financial affairs of the company.

ii. They should ensure that these financial statements are prepared in accordance with recognized International Accounting Standards and guidelines.
iii. Ensure that the financial statements comply with the Companies Act as far as possible.

iv. The directors have a responsibility to maintain proper books of account required the Companies Act. These include journals, registers schedules etc necessary to record all the transactions of a company.

v. They should ensure that the financial statements are in agreement with the underlying books of account.

vi. Ensure that the financial statements are timely availed to all users. This demands that they co-ordinate the accounting staff properly.

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