article thumbnail

On Creative Accounting: Two Creativity Myths

Harvard Business Review

"Creative accounting" is really bad. For me, it evokes a wonderful old New Yorker cartoon by Robert Weber , where a small, meek accountant stands before the desk of an overfed chief executive exhorting the accountant to rescue the company: "It's up to you now, Miller. So, by definition, creativity is morally neutral.

article thumbnail

We Can’t Study Short-Termism Without the Right Metrics

Harvard Business Review

Third, firms understate their depreciation expense because they assume that their long-lived assets will retain their worth over the long term — even though technological change increasingly makes them obsolete. Such misplaced optimism potentially masks underinvestment in technology needed to keep up with the competition.

EPS 9