cooking the books Finance Definition
A slang term that means illegally falsifying financial
statements. A company may try to cook the books in order to hide a loss, a
drop-off in sales, or a liability that it doesnt want to disclose; in order to
protect the share price from falling; or to keep creditors from demanding
additional collateral or the immediate repayment of loans. It also may be done
in order to decrease the amount of income tax that the company has to pay.
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