tive had both positive and negative impacts on the evolution of French accounting. Among the positive results were the introduction of the “true and fair” concept used in English-speaking countries, which -goes beyond the French notion of comptes reguliers et sinceres (whose meaning is closer to careful obedience of the law), the new level of importance granted to notes to financial statements, the break­ down of income taxes information on deferred taxes. Among the negative impacts of the fourth directive on French accounting were the abandonment of the requirement for the preparation of a statement of changes in financial position; the partial abandonment of the functional classification in the balance sheet reverting to the previous classification of elements according to their degree of liquidity/maturity; and the abandonment of the computation of value added on the income statement. At the EEC level, financial statements were not designed with the same broad objective of serving micro and macro-accounting as in France. Furthermore, its development was based on the 1957 Accounting Plan's financial statements and on the German financial state­ ments in use in the 1960s [Nichus, Spring 1972]. Therefore, a number of innovations of the 1975 Plan, some of which reflected national accountants' demands, were not incorporated into the fourth directive. Similarly, since no conciliatory work had been done on a possible statement of changes in financial position at the EEC level, no such statement was included among the manda­ tory documents to be prepared annually by firms. EEC member countries could go beyond the fourth directive's requirements when incorporating its provisions into their respec­ tive laws. Nevertheless, France was bound by the EEC require­ ments, since the French industry representatives at the CNC found support in the directive for their claims for simpler statements and fewer disclosures than originally anticipated in the 1975 Plan. French companies did not want to have to disclose more informa­ tion than was required from their EEC competitors. Furthermore, it was not difficult at this point for industry representatives at the CNC to bring about changes in the 1975 Plan, since it was only a draft and had not yet been implemented. A compromise solution involved providing, in addition to the basic set of financial state­ ments, a more elaborate, optional set of documents with the same basic structure as the EEC directive statements, but retaining as many as possible of the innovations of the 1975 Plan. A third, much shorter set of statements was adopted for small firms. 298