THE PROBLEM OF “WINDOW DRESSING EFFECT” ON THE ACCOUNTING DATA BASES FOR DECISION MAKING

Abstract

To obtain and to structure the accounting data base and the financial data base arised from the former, three main kinds of problems have to be considered: the called “window dressing effect†as a phenomena of financial data distortions; distortion of the currency unit due to the high inflation rate that affects the accounting information; and, at least the lack of ratification in term of the presentation and comparison of the financial conditions of companies and countries. In this paper, we approach the case of “window dressing effectâ€, whose solution is considered as determinant in the short run to improve the trustworthy level and validity of the accounting system after the big corporate frauds happened in the beginning of the XXth. Century in the United States. Key words: Criative accounting. Positive Accounting. Window dressing effect.International ratification. Transparency