The financial reports, as the final product of the accounting information system, need to be accurate in order to maintain the main purpose of financial reporting. Applied methods and techniques of recognition and measurement of financial positions should be in the purpose of realistic and transparent presentation of the financial performances of the entity. However, creative accounting techniques are often used in the process of preparing and presenting financial statements in order to manage earnings and manipulate financial values. Manipulation of financial statements seems to be a generally present phenomenon, and the paper aims to identify the criteria used by members of the accounting profession in the Federation of Bosnia and Hercegovina (FBiH) to distinguish earnings management techniques from fraudulent financial reporting. The research reflects the perception of accountants and auditors in the FBiH regarding the possibility of recognizing suspicious accounting practices in business entities. The research is based on distinctive criteria used in developed economies of the world: measurement subjectivity, the materiality of financial item and compliance of financial reporting with generally accepted accounting principles, but identifies specific distinctive measures used by respondents, too. The results of the research reveal that the accounting professionals in the FBiH rely on distinctive criteria: materiality and compliance of reporting with International Financial Reporting Standards, including two additional measures: compliance of financial reporting with generally accepted practices and confidence of financial information. Respondents did not recognize subjectivity in assessment as a relevant measure of the distinction between earnings management and fraudulent financial reporting.
Agić E. Marketing analitika: Osnovne metode statističke analize sa primjenom u Stati. 2018.
2.
Aljinović Barać Ž, Šodan S, Vuko T. Koliko je računovodstvo fer vrijednosti zaista fer? In: Zbornik radova Ekonomskog fakulteta Sveučilišta u Mostaru, Posebno izdanje. 2015. p. 69–93.
3.
Coenen T. Expert fraud investigation: a step-by-step guide. 2009.
4.
Cvetković D, Bošković V. Pojavni oblici kreativnog računovodstva i najčešće manipulacije u finansijskim izvještajima. Časopis Oditor. 2017;4(2):78–89.
5.
Đorđević S, Mitić N. Alternativni računovodstveni postpuci, kreativno računovodstvo i lažno finansijsko izvještavanje. Časopis Oditor. 2020;6(2):21–37.
6.
Gabrić D, Bošnjak Ž. Empirijska analiza obilježja značajnih pogrešnih prikazivanja u financijskim izvještajima preduzeća u FBiH. Zbornik radova Ekonomskog fakulteta Sveučilišta u Mostaru. 2017;(XXIII):7–25.
7.
Gabrić D, Miljko M. Računovodstvene manipulacije u financijskim izvještajima poduzeća-istraživanje motivacije i poticaja. Ekonomska Misao i Praksa; Dubrovnik. 2018;27(1):3–27.
8.
Griffiths I. Creative accounting. 1986.
9.
Gulin D. Manipulacije s financijskim izvještajima. 2002;
10.
Isaković-Kaplan Š. Motivi menadžera u BiH za sačinjavanjem lažnih finansijskih izvještaja. Forenzička revizija, Zbornik radova. 2016;87–91.
11.
Mahami Z, Mouloudj K. Factors Affecting Detection of Manipulation in Financial Statements: An Empirical Study from Auditors’ Perspective. Journal of Business. 2020;6(1):11–24.
12.
Novalija Islambegović S, Islambegović N. Model otkrivanja računovodstva “velikog čišćenja” u financijskim izvještajima s posebnim osvrtom na otpisivanje potraživanja. In: Zbornik radova Ekonomskog fakulteta Sveučilišta u Mostaru, posebno izdanje, ISSN 1840-3255. 2015. p. 225–49.
13.
Oladipupo Olaoye F, Adeniyi A. Effect of Accounting Manipulations on Performance of Selected Listed Firms in Nigeria. American Scientific Research Journal for Engineering, Technology, and Sciences (ASRJETS. 2020;63(1):158–70.
14.
Powell L, Jubb C, Lange P, Langfield-Smith K. The Distinction between Aggressive Accounting and Financial Reporting Fraud: Perceptions of Auditors. 2005.
15.
Rajković S. Beneishov M-score model u funkciji detekcije računovodstvenih manipulacija. Naučni časopis za ekonomiju, Tom. 2016;01(16):38–42.
16.
Safta IL, Achim MV, Borlea SN. Manipulation of financial statements through the use of crative accounting, case of Romanian companies. Studia Universitatis “Vasile Goldis” Arad Economics Series. 2020;30(ue 3/2020):90–107.
17.
Serdarević N, Muratović-Dedić A. Revenue Recognition and Real Earnings Management in Bosnian Construction Industry. Journal of Forensic Accounting Profession. 2021;1(1):21–34.
18.
Serdarević N, Muratović-Dedić A. Financial reporting incentives: taxation and external financing need. BH economic forum. 2020;12(1):57–69.
19.
Sherman D, Young D. Where financial reporting still falls short. Harvard Business Review. 2016;
20.
Strakova L. Motives and techniques of earnings management used in a global environment. 2020.
21.
Taherdoost H. Sampling Methods in Research Methodology; How to Choose a Sampling Technique for Research. International Journal of Academic Research in Management (IJARM. 2020;5(2):18–27.
22.
Vukoja B. Revizija financijskih izvještaja gospodarskih društava. 2007;
Citation
Copyright
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
The statements, opinions and data contained in the journal are solely those of the individual authors and contributors and not of the publisher and the editor(s). We stay neutral with regard to jurisdictional claims in published maps and institutional affiliations.
