Organization of group discussion on 'Creative Accounting Practice in Corporates' in the Department of Accounting and Business Statistics

Organization of group discussion on 'Creative Accounting Practice in Corporates' in the Department of Accounting and Business Statistics, Sukhadia University. Department of Accounts and Statistics organized a discussion on the highly sensitive issue 'Creative Accounting Practice in Corporates'. Chairman of the department, Professor Shoorveer Singh Bhanawat said that on the occasion of World Ethics Day, business organizations and accountants should play their right role and portray the financial statements and reports correctly and not use creative accounting. He said that while fulfilling its social responsibility, the department keeps trying to find various suggestions and solutions by discussing various challenging issues related to accounting related to the society. Assistant Professor and program coordinator of the department, Dr. Asha Sharma said that the collective B Walk (Accounting, Audit and Taxation), M Walk (Accounting, Audit and Taxation), M Com, MFC and researchers from the department participated in the discussion. Welcomed all the participants and gave a brief introduction to creative accounting. In the next sequence of discussion, students, researchers and faculty members put forward their views in which Anshika, a student of Biwalk, gave the definition of creative writing. Giving the example of Satyam Company, Ashok Singh Rana explained that this type of accounting was done by creating fake invoices through creative accounting. Later it was revealed as a scam. Dr. Samta Ordia told that creative writing can be called both legal and illegal. She said that showing more sales, payment of loan at the end of the year etc. can manipulate the figures. Shri Pushpraj Meena called it window dressing. Dr. Parul Dashora said that creative accounting is done so that the loan can be easily availed so that the company can show higher profits. Ashok Sharma said that creative accounting can focus the attention of investors by showing the balance sheet in good condition and also increase the liquidity ratio to increase its debt rating. Gaurav Surana gave the example of Byju's app. He said that when you purchase a course from Byju's app, even if the duration of the course is more than 1 year, they still show the entire revenue in the first year, due to which the profit gets reduced in the next years. Which is a wrong way of reporting. Deepak Suthar gave the example of RIICO company. He said that its fraud was exposed in 2015 when PWD conducted a forensic audit. It was found that they showed more cash and bank balance and increased the debt on the liability side, due to which their rating increased and Their debt turnover ratio decreased. Neha Bansiwal told that creative writing is done to tell the good position of the company to the stakeholders. Head of the Department, Prof. Shoorveer Singh Bhanawat, explained the Satyam scam in detail and gave the main four reasons for creative accounting, in which first is manipulation of share price, second is compliance, third is greed of top management people, fourth is incompetence of accountants and auditors and according to a report Mentioned three categories of fraud, first being embezzlement of assets, second corruption, third fraud in financial statements. He also explained the reasons for fraud in financial statements – Revenue Besting Scheme, Artificial Dealings, Gross ups, Misallocation of Expenses. Finally, at the conclusion of the program, Dr. Asha Sharma told that creative accounting can also be called aggressive or innovation accounting. And thanked all the participants present. Faculty members Dr. Shilpa Vardia, Dr. Shilpa Lodha, Dr. Parul Dashora, Mr. Pushparaj Ji Meena and researchers, students were present in the group discussion.