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InvestHub.com's
Finance Dictionary and Glossary of Investment Terms

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Definition 1.

An accounting practice where a company uses generous reserves from good years against losses that might be incurred in bad years.
 

Definition 2.

A sometimes questionable corporate accounting practice of taking reserves against losses during profitable years and using them in unprofitable years, to smooth out the earnings numbers and make the company's operations seem more consistent than they are.
 
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