Uncovering the Financial Numbers Game: How Creative Accounting Practices Deceive Investors
The article discusses how companies use creative accounting practices to manipulate financial numbers. It explains different techniques like premature revenue recognition and aggressive cost capitalization. The researchers also look at earnings management and the SEC's response to these practices. Financial professionals' opinions on the matter are also included. The study provides checklists to help detect misreported assets and liabilities, as well as ways to spot creative income statement classifications. Overall, the article aims to shed light on the financial numbers game and how to identify deceptive practices in financial reporting.