vasudeo007

 Profile Answers by vasudeo007 

• Aug 17th, 2008

 

One of the most significant aspects of expenses is Depreciation.

By changing the method of depreciation one can inflate profits. From straight line to reducing balance method without retrospective effect can inflate profits.

Second method is to show revenue expenses as capital expenses.

Example: Revenue repairs and maintanence expenses debited to plant and machinery instead of profit and loss account etc.

Third method is appreciate assets like building, plant etc. This will show better balance sheet.

Fourth method is showing capital receipts as revenue receipts like lottery winning as earning from business

Fifty method is overvaluing closing stock

Hope this answer has solved your query.

There may be more methods, please update me about the same.

Vasudeo