CREATIVE ACCOUNTING, AN EXPRESSION OF THE DISCONNECTION BETWEEN ACCOUNTING AND TAXATION

In the context of a developed capital market, the dimensioning of the accountingprofit is very important for investors, considering the financing of the economic entities to ahigher degree than that offered by the banking system. We intend to emphasize some risks thatappear from the perspective of creative accountancy (an expression of the disconnectionbetween accountancy and taxation). The risks consist in some less ethical tendencies ofartificially oversizing and undersizing the accounting and the tax profit according to certainobjectives, risks that can be controlled through a better activity of accounting regulations. Wecan say that the accounting result can be influenced in the case of a taxation connected ratio.On the other hand, the accounting result is subject to an increasing risk due to the creativeaccounting. Under these circumstances, a question appears: Which risk is better to beassumed taking into account the dimension of the accounting result?