Substance over form is an accounting principle used "to ensure that financial statements give a complete, relevant, and accurate picture of transactions and events".
Following are examples of the application of the concept in the International Financial Reporting Standards (IFRS).
Although the legal ownership has been transferred to the bank, the underlying economic reality for the company remain the same.
The principle strictly governs and resolves disputes of whether workers are independent contractors or employees: Tax law forbids accounting for persons who are substantially employees in the form of independent contractors.
The question of which form may be applied to any given case submits to objective tests of the substance of the work.