Accounting and other information of a company is communicated through Annual reports in an organization. Companies have been constantly facing the problem of satisfying different stakeholders with their varied needs. Satisfaction of one’s needs leads to the dissatisfaction of others. In order to satisfy the profit expectation of different stakeholder, there is a need to maintain a balance between the two extreme points i.e.,higher profit and lower profit. To maintain this balance, the accountant adopts the technique of creative accounting. The accounting policies are too many and vary between different countries. The multiplicity of accounting policies even within a particular country has given the management of companies an opportunity to adopt the techniques of Creative Accounting. Income Smoothing is one technique of Creative Accounting. The objective of the paper is to detect Income Smoothing Behaviour among the listed companies in India using Inferential Statistical techniques and also tries to find out the association between the Income Smoothing Behaviour and Sector of operation (Public or Private) and Management of Companies (Family based or professionally managed.

Financial Reporting, Creative Accounting, Income Smoothing