Academic journal article Academy of Accounting and Financial Studies Journal

The Impact of the Application of the Governance Mechanisms on the Efficiency of the Audit Performance and the Level of Disclosure in the Financial Reports: An Applied Study to a Sample of Companies Listed in the Iraqi Stock Exchange

Academic journal article Academy of Accounting and Financial Studies Journal

The Impact of the Application of the Governance Mechanisms on the Efficiency of the Audit Performance and the Level of Disclosure in the Financial Reports: An Applied Study to a Sample of Companies Listed in the Iraqi Stock Exchange

Article excerpt

INTRODUCTION

Researchers and practitioners have dedicated a considerable attention in studying the problem of corruption and they have necessitated the need to develop and establish institutional framework designed to address the problem through-out and specific action plans. These plans are actually aimed at frightening corruption in all its forms and manifestation in the life aspects so as to accelerate the process of economic progress. The issues of financial and administrative corruption are not confined in terms of their impacts to the negative aspects present in a certain sector of society, but they also extend to all members and sectors of society. They actually have a direct impact on the country's overall performance in the market and impede economic development, as well as causing a disruption in the structural foundation of the larger community. Additionally, such ill practices can turn individuals against their own values by embracing code of conducts which are considered alien and unwelcomed in any society where those values and principles are usually well-established. In order to achieve the objectives of the present study, the researcher is divided into three main parts: the research methodology, theoretical framework and the practical perspectives. Finally, the researcher has ended his researcher with a series of conclusions and remarkable recommendations for further studies.

LITERATURE REVIEW

The study of the governance of corporates has been the concern of many scholars and researchers due to its importance in regulating the codes of conducts to the corporates various performances including auditing. These studies are at the local and international levels. To avoid a synthesis of the repeated related literature, the researcher refers to some of the remarkable studies in this concern below.

Al-Beshtawi, Zraqat & Al-Husseini's (2015) study entitled "Corporate Governance and its Impact on Disclosure Level in the Accounting Information in Iraq". The study aimed at explaining the impact of corporate governance on the level of accounting disclosure in the financial statements. The problem of the study was focused on answering the main question which is: (what is the impact of corporate governance on the level of disclosure on the financial statements?) The study concluded with a number of conclusions, the most important of which are:

* The level of disclosure in the financial statements of the Public Shareholding Company in Iraq.

* A positive relationship with statistical significance indicating the concentration of individual ownership in the Public Shareholding Company in the Kingdom of Saudi Arabia and the level of disclosure in the financial statements.

* There is no statistically significant negative relation between the independence between the members of the board of directors of the Public Shareholding Company in Iraq and the level of disclosure in the financial statements.

* The existence of positive correlation with positive a statistical significance of the size of the company and the level of disclosure in the financial statements of the public shareholding company in Iraq.

Al-Anzi's (2014) study entitled "An Analysis of the Impact of Corporate Governance on the Quality of Accounting Disclosure: An Applied Study to a Sample of Iraqi Banks". This study aims to examine the relation between administration board size and the accounting disclosure level in a sample of 1o Iraqi banks. The study reached to a number of theoretical and practical conclusions that the most important of which are:

* There is no clear legal text emphasize the application of the principles and mechanisms of corporate governance in Iraq, but the legislations that control the Iraqi companies include implication of such principles and mechanisms.

* The good application of the corporate governance leads to decreasing the problems result from the gap between the stockholders and the executive managers due to the negative practices of those executive managers, so it helps in sort of, control the managers by being interesting on the stockholders benefits. …

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