The impact of the value of external audit within the framework of situational factors on the appropriateness of the value of accounting information in the Iraqi environment

دراسة استطلاعية لعينة من العاملين في بعض الوحدات الاقتصادية المدرجة في سوق العراق للأوراق المالية

Abstract

                 In light of the stock market's reliance mainly on accounting information, and the value relevance of that information represents an important criterion for judging its usefulness or not and the factors affecting it, it has resulted in the conduct of many studies to determine the influence of the determinants affecting the relevance of the value of accounting information and the economic decisions of stakeholders, aiming to The current research aims to measure the effect of the value of external audit within the framework of situational factors in the suitability of the value of accounting information in Iraqi economic units. An applied study of a sample of audit offices, the Financial Supervision Bureau and Iraqi banks listed on the Iraqi Stock Exchange, represented in measuring the effect of situational factors in the value of external audit through a questionnaire. For a sample of auditors in the Financial Supervision Bureau and audit offices, the effect of the value of external audit was measured quantitatively within the framework of situational factors using the earnings management scale and the investment efficiency scale in the suitability of the value of accounting information. The price and return models were used to measure the suitability of the value of accounting information for 14 banks from the year (2010-2022).The two researchers reached a set of conclusions, the most important of which is that there is an impact for each of the situational factors and the value of external audit, as the more there is interest or availability of situational factors, the greater the opportunity to realize the value of external audit. The situational factors that influence achieving the value of external audit are divided into (factors Societal factors - professional factors - legal factors - environmental factors - individual factors). In financial markets, investors need appropriate and faithfully representative information on which to base their decisions, and then they search for tools to evaluate the quality and value of the information provided that refers to the stocks. To solve the investors’ problem, the financial statements must be audited. Obtaining an opinion related to the quality of the information reported, and this is through the value of external auditing, and by choosing two indicators to measure the effect of the value of external auditing (earnings management and investment efficiency) on the suitability of accounting information. The two researchers concluded that there is no effect of earnings management using honest representation of financial reports on the suitability. The value of accounting information is justified by the role of external audit and its value in the absence of financial reports from earnings management, in addition to the lack of impact of investment efficiency on the suitability of the value of accounting information due to investors’ reliance on information other than accounting information.The researchers recommended a number of recommendations, the most important of which are:The auditor should be given primary attention when wanting to maximize the value of the external audit, as it is a key variable in achieving the value of the external audit.More attention should be given to the factors affecting the value of external auditing because it is one of the determinants of the appropriateness of the value of accounting information and significantly affects the perception and views of different users of economic units and the information they publish.