THE INFLUENCE OF CREATIVE ACCOUNTANCY ON FINANCIAL REPORT QUALITY

Financial statements are the most important output of a company’s accountancy department. Numerous internal and external adresees of financial statements make different business decisions based on the data contained in financial statements. Financial statements should be composed following specific principles of financial reporting so that the decisions could be the right ones. Meeting these criteria will result in true and objective statements, consequently making the decisions based on them adequate. However, financial reporting is prone to manipulations and illegal acts, which may result in obscure and forged reports. All measures carried out with the purpose of composing financial statements which do not reflect true financial and revenual strength of a company may be termed as “creative accountancy“.

Key words: financial reporting, financial statements, financial statement users, principles of financial reporting, creative accountancy.

JEL Classification: M41