Is the assumption on commonly used conversion between true and engineering stress for tensile testing wrong?

When I Google conversion between engineering and true stress conversion, I found a ton of webpages using the following formula:

True strain = ln(1 + engineering strain)

True stress = (engineering stress) * exp(true strain) = (engineering stress) * (1 + engineering strain)

However, this stress conversion is only true when the material is fully incompressible (Poisson's ratio = .5). For plastics,  Possion's ratio is often around 0.3, current area * current length ≠ original area * original length, and therefore this equation is quite problematic.

Am I thinking wrong, or that this equation (that has been long used by the industry) wrong?

Thanks,

Shawn