Definition

An embezzlement technique where stolen money from customer A is covered using money from customer B, creating a ponzi scheme internal to your own company.

Example Usage

The auditors discovered lapping in accounts receivable—apparently Karen has been stealing from us for three years.

Origin

Accounting fraud terminology dating back decades

Fun Fact

Lapping is one of the oldest and most common fraud schemes and yet companies still fall for it

Source: Forensic accounting and fraud detection terminology

Related Terms

Beginner

stocks

Pieces of corporate ownership that you can buy and sell obsessively while checking your phone every five minutes. Or, a supply of raw materials waiting to become something useful.

💰 Finance / Accounting
Beginner

expense

Money that exits your bank account faster than your ability to justify why you needed it in the first place. In business contexts, it's the art of categorizing spending so the tax man won't cry, and in personal finance, it's the stuff that makes you wonder where your paycheck went. Track them obsessively or live in blissful ignorance—there is no middle ground.

💰 Finance / Accounting
Advanced

backflush costing

A simplified cost accounting system that records costs only when production is complete, skipping the tedious tracking of work-in-process. It's for manufacturers who prefer speed over precision and assume everything flows smoothly.

💰 Finance / Accounting
Advanced

Extraordinary Items

Unusual, infrequent events that significantly impact financial results—like selling off a division or natural disaster losses. Companies use this to claim profits look better than they actually are.

💰 Finance / Accounting
Advanced

Zombie Firm

A company kept alive by continuous financing despite being unprofitable and unlikely to ever make money. Financial walking dead.

💰 Finance / Accounting
Intermediate

royalties

The passive income dream where creators get paid every time someone uses their work, like a toll booth on the highway of intellectual property. These recurring payments flow to authors, musicians, inventors, and landowners who've figured out how to make money while sleeping. It's the closest thing to free money that still requires you to have created something valuable first, which is why most people just get regular jobs instead.

💰 Finance / Accounting

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See “Lapping” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.

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Intermediate

diluted

The soul-crushing moment when a founder's ownership percentage shrinks because the company issued more shares to new inv...