What is the meaning of SUBSTANCE OVER FORM?

SUBSTANCE OVER FORM is an accounting concept where the entity is accounting for items according to their substance and economic reality and not merely their legal form. This concept is one of the key determinants of reliable information. For most transactions there will be no difference, so no issue arises. In some cases however, the two diverge and the choice of how to present the transactions can give very different results. This difference occurs when an asset or liability is not recognized in the accounts even though benefits or obligations may result from the transaction, or oppositely.

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APABarry Goldsmith. (2010). substance over form. Retrieved September 23, 2026, from http://smartdefine.org/substance_over_form/definitions/1164510
ChicagoBarry Goldsmith. 2010. "substance over form" http://smartdefine.org/substance_over_form/definitions/1164510 (accessed September 23, 2026).
HarvardBarry Goldsmith 2010, substance over form, Smart Define, viewed 23 September, 2026, <http://smartdefine.org/substance_over_form/definitions/1164510>.
MLABarry Goldsmith. "substance over form" 21 October 2010. Web. 23 September 2026. <http://smartdefine.org/substance_over_form/definitions/1164510>