Purpose: While the main purpose of reporting -- e.g., reporting for taxes -- is to gauge the economic state of a company, the fact that reporting is done at pre-determined dates distorts the reporting results. For example, to create a larger impression of their productivity, companies fire temporary workers before the reporting date and re-hire then right away. The purpose of this study is to decide how to avoid such distortion.
Design/methodology/approach: We want to make our solution applicable for all possible reasonable optimality criteria. Thus, we use a general formalism for describing and analyzing all such criteria.
Findings: We show that most distortion problems will disappear if we replace the fixed pre-determined reporting dates with individualized random reporting dates. We also show that for all reasonable optimality criteria, the optimal way to assign reporting dates it to do it uniformly.
Originality/value: We propose a new idea of replacing the fixed pre-determining reporting dates with randomized ones. On the informal level, this idea may have been proposed earlier, but what is completely new is our analysis of which probability distribution for reporting dates is the best for economy: it turns out that under all reasonable optimality criteria, uniform distribution works the best.