Window dressing - window dressing

An accounting practice in which profits are overstated in order to make a company's profit and loss situation and financial condition look better than they actually are. Conversely, accounting practices that attempt to make profits look understated are called reverse window dressing. There are many motives for window dressing, including continuing to borrow from financial institutions, maintaining dividends, maintaining stock prices, and even protecting the position of management. In the past, most window dressings were committed by management due to these motives, but recently there have been an increasing number of cases where executives and managers are involved due to strict business targets set by management.

Specific methods of window dressing include overstating or fictitious recording of sales, understating of expenses, overstating of deposits and products, and understating of loans. These transactions are often carried out with the cooperation of business partners or subsidiaries. In particular, there has been an increase in cases where unconsolidated subsidiaries and special purpose companies (SPCs) are used to record fictitious profits.

In order to prevent such fraudulent accounting, listed companies and large companies are required to have audits by certified public accountants and auditing corporations. The Financial Instruments and Exchange Act stipulates that managers who falsify their financial statements are punished with severe sanctions of up to 10 years in prison or a fine of up to 10 million yen for false statements in securities reports, and for corporations, a fine of up to 700 million yen, as well as a system of surcharges determined by the Commissioner of the Financial Services Agency.

[Yoshito Nakamura]

"Casebook of Audit Theory, by Hiroshi Yoshimi, 4th Edition (2008, Shinseisha)" "Recent Window Dressing: The Actual Situation and How to Discover It, by Kazuo Ibata, 2nd Edition (2008, Tax Accounting Association)"

Source: Shogakukan Encyclopedia Nipponica About Encyclopedia Nipponica Information | Legend

会社の損益状況や財政状態を実際よりよくみせようとするため、利益を過大に計上する会計行為。逆に利益を過少にみせようとする会計行為は逆粉飾という。粉飾決算を行う動機としては、金融機関からの借入の継続、配当の維持、株価の維持、さらには経営者の地位の保全などさまざまなものがある。このような動機から粉飾決算は、過去の事例では、経営者が行ったものがほとんどであるが、最近は経営者からの厳しい業務目標などを原因として役員や管理職が行うケースも増えている。

　粉飾決算の具体的な手法としては、売上げの過大・架空計上、費用の過少計上、預金や商品などの過大計上、借入金の過少計上などがある。これらの取引を取引先や子会社の協力のもとに行うことが多い。とくに、連結していない子会社やSPC（特定目的会社）を利用して架空の利益を計上する事例が増えている。

　このような粉飾決算を防止するために、上場会社や大会社においては、公認会計士・監査法人による監査が強制されている。粉飾決算を行った経営者に対しては、金融商品取引法による有価証券報告書虚偽記載として、10年以下の懲役または1000万円以下の罰金、法人には7億円以下の罰金の厳しい制裁と金融庁長官の決定による課徴金納付制度が定められている。

［中村義人］

『吉見宏著『ケースブック監査論』第4版（2008・新世社）』▽『井端和男著『最近の粉飾――その実態と発見法』第2版（2008・税務経理協会）』

出典　小学館　日本大百科全書(ニッポニカ)日本大百科全書(ニッポニカ)について　情報 | 凡例