SAIPA Professional Evaluation Exams 2016 - Important dates
If directors of a company have a property in their own names (bond also in own names), can the property be shown in the financial statements of the Company. The client is of opinion that the substance over form principle should be applied and not the legal form. Does this principle apply to property? The company rents the property from the directors.
In a situation like this I would have to ask the question as to why the directors want to show the property in the Company’s name. It is not clear from your information what that might be. Their take on the substance over form principle will only hold true if the company did not rent the property from the directors.