2011
DOI: 10.29302/oeconomica.2011.13.1.3
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From Creative Accounting Practices And Enron Phenomenon To The Current Financial Crisis

Abstract: The aim of this paper is to bring into attention the creative accounting phenomenon. Types of creative accounting practices has been examined comparing scandals occurred in large companies in the last two decades. In order to realize this scope we define the concept of creative accounting and its various forms, and we try to figure the reasons why we came into a financial crisis again, even if the history taught us that the risks are very large. We discuss the implication of creative accounting in the current … Show more

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Cited by 23 publications
(11 citation statements)
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“…But, to the best of the author(s) knowledge, no research has linked sustainable financial data governance with creative accounting practices. Further, the deleterious effects of financial reporting have been mentioned by prior researchers (e.g., [25,28,34]). Surprisingly, the consequences of poor-quality reporting have been widely overlooked in the literature.…”
Section: Introductionmentioning
confidence: 92%
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“…But, to the best of the author(s) knowledge, no research has linked sustainable financial data governance with creative accounting practices. Further, the deleterious effects of financial reporting have been mentioned by prior researchers (e.g., [25,28,34]). Surprisingly, the consequences of poor-quality reporting have been widely overlooked in the literature.…”
Section: Introductionmentioning
confidence: 92%
“…Annual financial reports are published with the aim to provide public data on cash flows, financial position, and performance of a company. Research shows that these data are useful to a wide range of users (i.e., private and public entities) in making economic decisions [25]. For example, financial statements have been shown to affect SME owner's decision effectiveness [4], and it is also used to assess the overall health of family firms and guides decision makers [55,56].…”
Section: Hypotheses 3 (H3)mentioning
confidence: 99%
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“…Those who apply creative accounting methods can manipulate various areas of the enterprise's accounting: non-current assets accounting, inventories accounting, equity accounting, liabilities accounting, recognition of income and expenses, accounting policy, the need for working capital, treasury, expenses of assets, profitability, etc. (Lakis, 2011;Gherai, Balaciu, 2011;Giriūnienė, 2012;Mačiuitytė-Radickienė, Subačienė, 2012;Bachtijeva, Tamulevičienė, 2019). The main goal of creative accounting is to satisfy the enterprise's wish to present the results of its activities in the financial statements as they wish.…”
Section: Creative Accounting: a Tool To Make The Enterprise More Attractivementioning
confidence: 99%
“…On the contrary, different alternatives allow the accountants to use their competence and creative abilities to seek optimal methods (Malhotra, 2013;Cernusca et al, 2016). Due to the variety of enterprises and activities, they all have to be flexible in accounting to a certain extent but this has to be done in order to present true results rather than distort them (Gherai, Balaciu, 2011). Nevertheless, studies show that creative accounting is widely applied in various countries to deliberately gain advantage in the market, decrease tax benefits, show that the profits are higher or lower than in reality.…”
Section: Creative Accounting: a Tool To Make The Enterprise More Attractivementioning
confidence: 99%