Open AccessAssumptions, Types of Accounting Manipulations and Their Application
Author(s) -
Diana Bachtijeva
Publication year - 2021
Publication title -
buhalterinės apskaitos teorija ir praktika/buhalterinės apskaitos teorija ir praktika
Language(s) - English
Resource type - Journals
eISSN - 2538-8762
pISSN - 1822-8682
DOI - 10.15388/batp.2021.33
Subject(s) - earnings management , accounting , creative accounting , accrual , management accounting , positive accounting , throughput accounting , cost accounting , accounting information system , business , earnings response coefficient , financial accounting , accounting management , profit (economics) , economics , constraints accounting , accounting research , equity (law) , accounting method , earnings , political science , microeconomics , law
The article describes the bonus plan, debt/equity and political cost hypotheses, based on a positive accounting theory, with reference to opportunistic approach, explaining the reasons for choosing accounting methods. Research based on these hypotheses has revealed the main types of financial information manipulation - earnings management and creative accounting. After conducting the analysis of scientific sources, the article presents the definitions of earnings management and creative accounting of various authors, distinguishes the types of earnings management – accrual-based earnings management and real earnings management. After analyzing the manipulation methods indicated in the literature, a comprehensive list of profit management and creative accounting methods are presented. The methods are structured and classified according to their compliance with accounting standards, types of profit management and their impact on accounting areas. The provided list and classification of methods is useful in a scientific sense for further research on this phenomenon.