Earnings management practices and their effects on the quality of financial reporting

Abstract

       his research aims to reveal the extent to which Iraqi commercial banks listed on the Iraqi Stock Market practice earnings management practices in the financial statements and the extent of the quality of financial reporting in them on the one hand, and the impact of these practices on the quality of financial reporting on the other hand. In order to achieve the goal of this research, the research was applied In Khaleej Commercial Bank, which is one of the commercial banks listed on the stock market for a period of (2013-2019) A set of statistical and financial methods were used, such as the correlation coefficient, regression, and the F, T test, to test the research hypotheses.The results that have been reached are that the financial reporting announced by the Iraqi commercial banks, the research sample, is not characterized by a high level of financial reporting quality because it is subject to earnings management practices, and that these practices have a statistically significant negative impact on the quality of financial reporting for those banks. The most important recommendations: Research on accounting standards setters to limit management’s ability in earnings management practices by reducing the number of alternatives in terms of measurement or quality of earnings while setting controls for each of those alternatives, and working through adequate and fair disclosure in order to improve the transparency of financial statements, as well as Working to make accounting ethics an independent subject within the curricula in Iraqi universities for the Faculties of Administration and Economics, Department of Accounting. To cover the topic, the research was divided into sections (research methodology, previous studies, earnings management practices, quality of financial reporting, earnings management and its impact on the quality of financial reporting, conclusions and recommendations)