International E-publication: Publish Projects, Dissertation, Theses, Books, Souvenir, Conference Proceeding with ISBN.  International E-Bulletin: Information/News regarding: Academics and Research

Creative Accounting: Developing A Model

Author Affiliations

  • 1Department of Business and Economics, FURC, New Lalazar (Off GT Road-Opp. Ayub Park), Rawalpindi, PAKISTAN

Res. J. Recent Sci., Volume 4, Issue (11), Pages 146-150, November,2 (2015)


The purpose of this paper is to understand the concept of creative accounting well, to differentiate between earnings management and fraud, for which literature review has been thoroughly analyzed. Model has been developed, which demonstrates the parties i.e. Banks, Auditors, Investors, Regulatory authorities etc. that are involved in creative accounting. Accounting professionals take advantage of the loopholes in the accounting regulations to manipulate accounts. Creative accounting can be done either “Beyond the Regulatory requirements” or “Within the Regulatory requirements”. This study suggests that Manipulations can be controlled by the effective implementation of Corporates’ internal control systems, compliance with codes of corporate governance and meeting the financial reporting regulatory requirements.


  1. Hussey R. and Ong A., Creative Accounting, Do Numbers Reveal the Whole Picture?, Credit Control, 16–20 (1996)
  2. Naser K., Creative financial accounting: its nature and use, Hemel Hempstead: Prentice Hall (1993)
  3. Wells J.T., Fraud: The occupational hazards. Accountancy Age, Retrieved from aa/feature/1748964/fraud- occupational-hazards, 1 (2009)
  4. Lord A.T., The prevalence of fraud: What should we, as academics, be doing to address the problem?, Accounting and Management Information Systems, 9(1), 5 (2010)
  5. Perols J.L. and Lougee B.A., The relation between earnings management and financial statement fraud. Advances in Accounting, Incorporating Advances in International Accounting, Retrieved from, 2 (2010)
  6. Kellogg I. and Kellogg L.B., Fraud, window dressing and negligence in financial statements. McGraw Hill, Colorado Springs, (1991)
  7. Omurgonulsen M. and Omurgonulsen U., Critical thinking about creative accounting in the face of a recent scandal in the Turkish banking sector, Critical Perspectives on Accounting, 20(5), 651-673 (2009)
  8. Baruch L., intangibles: Management, Measurement, and Reporting. Washington DC, The Brookings Institution Press, (2001)
  9. Watts R.L. and Zimmerman J.L., Positive accounting theory: A ten year perspective, The Accounting Review, 65(1), 131-156 (1990)
  10. Trotman M., Comptabilite britanique, mod d’emploi, Economica, Paris (1993)
  11. Jameson M., A practical guide to creative accounting, Kogan Page (1988)
  12. Smith T., Accounting for growth, London: Century Business, (1992)
  13. Merchant K.A. and Rockness J., The ethics of managing earnings: an empirical investigation, Journal of Accounting and Public Policy, 13, 79-94 (1994)
  14. Shah A.K., Creative Compliance in Financial Reporting, Accounting, Organizations and Society, 21(1), 23–39 (1996)
  15. Mac Barnet D. and Whelan C., Creative Accounting and the Cross-Eyed Javelin Thrower, Wiley, Chichester (1999)
  16. Stolowy H. and Breton G., Accounts Manipulation: A Literature Review and Proposed Conceptual Framework, available on-line at:
  17. Ramaswamy V., Corporate Governance and the Forensic Accountant, The CPA Journal, 75(3), 68-70 (2005)
  18. Usurelu V.I., Marin M., Danaila A.E. and Loghin D., Accounting ethics- responsibility versus creativity, Annals of the University of Petroani, Economics, 10(3), 349-356 (2010)
  19. Rabin C., Determinants of auditors attitudes towards creative, Meditari Accountancy, 13(2), 67-88 (2005)
  20. Cosmin L.I., A census of creative accounting techniques, Romanian Economic Business Review, 5(4-1), 104-108 (2010)
  21. Elisabeta B.D. and Beattrice V.A., Creative accounting : players and their gains and losses, Annals of Faculty of Economics, 1(2), 813-819 (2010)
  22. Shah S., Butt S. and Tariq Y.B., Use or abuse of creative accounting techniques, International Journal of Trade, Economics and Finance, 2(6), 531-536 (2011)
  23. Teodora C.A. and Nicolae B., Study regarding the ethics and creativity in the financial- accounting activity, 844-849 (2009)
  24. Moldovan R.L., Achim S.A. and Avram C.B., Fighting the enemy of fair view principle?, Getting to know creative accounting, In: analelestiintifice ale universitatiialexandruioancuza din iasi – stiinteeconomice, Repec: aic: Journal, 51-62 (2010)
  25. Gherai D.S. and Balaciu D.E., from creative accounting practices and Enron phenomenon to the current financial crisis, AnnalesUniversitatisApulensis Series Oeconomica, 1(13), 34-41 (2011)
  26. Amat O., Blake J. and Dowds J., The ethics of creative, Economics Working Paper, (1999)
  27. Sutton T.,Financial Accounting and Reporting, Harlow: Financial Times Prentice Hall (2004)
  28. Shah S.Z. and Butt S., Creative Accounting: A Tool to Help Companies in a Crisis or a Practice to Land them into Crises, International Conference on Business and Economics Research, 16, 96-102 (2011)
  29. Young E., Fraud: the Unmanaged Risk. 8th Global Survey, South Africa: Ernst and Young (2002)
  30. Jones M.J., Creative Accounting, Fraud and International Scandals, Chichester: John Wiley and Sons Ltd. (2011)