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Accounting record



Sometimes, companies must make their accounting records objectively, but accounting legislation has certain gaps or ambiguities that arise when accounting for certain aspects. In addition there are many points of accounting between which can be chosen or others that require making provisions about the future, being able to be optimistic or pessimistic. Not to mention the desire of many companies to manipulate the data. Therefore, accounting, as currently regulated, does not reflect or report on reality, but "only follows the rules", giving rise to annual accounts transformed into companies. This is due to the predominance of a legalistic view when it comes to accounting for companies, that is, it is prepared by applying the rules, Regardless of the reality. At the moment, practically all the companies "make up the accounts" and rare is the company that has not used it in the last five years. The reasons for using this creative accounting are varied and extensive. There is a need to present an increase in results, such as in the banks, where despite economic crises, profits always increase with respect to previous years. Another set of reasons to use in creative accounting, applicable to all types of companies, arises because these are subject to different types of rights and contractual obligations, based on the amounts reflected in the financial statements; for example: Virtually all companies "makeup accounts" and rare is the company that has not used it in the last five years. The reasons for using this creative accounting are varied and extensive. There is a need to show an increase in results, such as in banks, where despite economic crises, profits always increase with respect to previous years. Another set of reasons to use in creative accounting, applicable to all types of companies, arises because they are subject to different types of rights and contractual obligations, based on the amounts reflected in the financial statements; for example: Virtually all companies "makeup accounts" and rare is the company that has not used it in the last five years. The reasons for using this creative accounting are varied and extensive. There is a need to show an increase in results, such as in banks, where despite economic crises, profits always increase with respect to previous years. Another set of reasons to use in creative accounting, applicable to all types of companies, arises because they are subject to different types of rights and contractual obligations, based on the amounts reflected in the financial statements; for example: There is a need to show an increase in results, such as in banks, where despite economic crises, profits always increase with respect to previous years. Another set of reasons to use in creative accounting, applicable to all types of companies, arises because they are subject to different types of rights and contractual obligations, based on the amounts reflected in the financial statements; for example: There is a need to show an increase in results, such as in banks, where despite economic crises, profits always increase with respect to previous years. Another set of reasons to use in creative accounting, applicable to all types of companies, arises because they are subject to different types of rights and contractual obligations, based on the amounts reflected in the financial statements; for example: Arises because these are subject to different types of contractual rights and obligations, based on the amounts reflected in the financial statements; for example: Arises because these are subject to different types of contractual rights and obligations, based on the amounts reflected in the financial statements; for example:
  • It is quite common for loan contracts to include a restriction on the total amount that a firm can obtain, calculated as a multiple of total capital and reserves.
  • Some companies, such as public utilities and urban cleaners, for example, are subject to the authority of a public regulatory body that establishes the maximum rates they can charge. If these companies reflect high profits, the supervisory body will respond by maintaining or freezing tariffs. Therefore, these companies are interested in the choice of accounting methods that tend to reduce the accounting profit.
  • A management model with remunerations linked to the profits or the share price of the companies will, in the case where they are linked to the share price, the managers are motivated to present accounts that impress the stock market. If the premium is tied to the benefit, managers will try to adjust the benefit figure so that their earnings are maximized.
  • When a subsidiary, division or division of the company is subject to a profit-sharing agreement, this may affect the preference for different accounting methods.

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