Sandbagging - What is it and has it been stopped?


R

richhuish

I've been mentioned the term sandbagging and told companies used to be
rife of companies having 'exceptional delays' and profit falling
therefore over 2 accounting periods.

Eg: A sells to B, Asset X for £5 million - falling in 2 accounting
periods £2.5m each. Now it's agreed that £4.8m will be paid now in 1st
period.

The company could apparently 'over reserve', and carry that excess
over to the next accounting period before 'washing' it into the P &
L.

Is this still the case has there been anything passed in terms of FRSs
to stop this practice?
 
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