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Working from the same data, different groups of people would produce very different financial 
statements. If the exercise of judgement is completely unfettered any comparability between the 
accounts of different organisations will disappear. This will be all the more significant in cases where 
deliberate manipulation occurs in order to present accounts in the most favourable light. 
3.4 UK accounting standards 
In an attempt to deal with some of the subjectivity, and to achieve comparability between different 
organisations, 
accounting standards 
were developed. 
3.4.1 The old UK regime 
Between 1970 and 1990 the standards (Statements of Standard Accounting Practice or SSAPs) were 
devised by the 
Accounting Standards Committee
. However, it was felt that these standards were too 
much concerned with detailed rules in which companies found it all too easy to find loopholes. 
The Accounting Standards Committee was replaced in 1990 by the 
Financial Reporting Council
. Its 
subsidiary, the 
Accounting Standards Board 
(ASB), issued standards 'concerned with principles rather 
than fine details'. Its standards were called Financial Reporting Standards (FRSs). However, it adopted 
all existing SSAPs and some of these are still relevant, although most have been replaced by FRSs. It 
was supported in its aim by the Urgent Issues Task Force and the Review Panel. 
3.4.2 The current UK regime 
In 2012, a number of reforms took place that made the FRC a unified regulatory body. As part of this 
reform, the Accounting Council and the UITF was disbanded and responsibility for setting accounting 
standards came under the FRC Board. 
3.4.3 Accounting standards and the law 
The Companies Act 2006 (TSO, 2006) requires companies to include a note to the accounts stating 
that the accounts have been prepared in accordance with