Cookie Jar Accounting

外汇网2021-06-19 13:45:52 83

An accounting practice in which a company uses generous reserves from good years against losses that might be incurred in bad years. Cookie jar accounting is a sign of misleading accounting practices.

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This gives the sense of "income smoothing", because earnings are understated in good years and overstated in bad years. You may have heard of companies taking special charges or write-downs - that's just another flavor of cookie jar accounting.

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