black-box accounting

(redirected from Black Box Accounting)

Black-Box Accounting

A slightly pejorative term used to describe highly and deliberately complex accounting methods. Companies usually use black-box accounting when they wish to appear more financially stable than they are. In doing so, they may report their earnings using overly-sophisticated methods designed to hide losses or boost profits. In explaining the methodology, companies may use unnecessarily technical language and/or include extraneous information in order to confuse the casual reader. It is thought to take a skilled person to "decode" black-box accounting.

black-box accounting

Accounting methodology so complex that financial statements are nearly impossible to accurately interpret. Black-box accounting may be used to obscure unfavorable information.