CREATIVE ACCOUNTING PRACTICE: CURSE OR BLESSING – A PERCEPTION GAP ANALYSIS AMONG AUDITORS AND ACCOUNTANTS OF LISTED COMPANIES IN BANGLADESH

Abstract

Creative Accounting also known as Hollywood accounting , income smoothing , cosmetic accounting is a legitimate accounting application where by the accountants and the auditors take advantage of the loopholes in the accounting policies as per International Accounting Standards (IAS) , Generally Accepted Accounting Principles (GAAP) . This research is conducted on the empirical data collected from the auditors and the accountants of the listed companies of Bangladesh who are the members of the Institute of Chartered Accountants of Bangladesh (ICAB) the professional accounting body in Bangladesh. They were interviewed using a 5 point Likert scale questionnaire and the responses were analyzed. A total 50 Auditors were surveyed from listed companies and 100 Accountants was surveyed from listed companies as respondents as to form an opinion at national level and have a meaningful contribution. The finding suggested that the practice of creative accounting was prevailing from the very inception of the books of records as many of the respondent's opinion suggests that. And many in their opinion suggested that it is a blessing, some referred to as it is a curse. While in many opinion we found that creative accounting is both a blessing and a curse depending on how we use the application.