Determinants of the Value Relevance of Accounting Information in Emerging Economies: Evidence from Iraq

Abstract

This research analyzes the Value Relevance determinants of accounting knowledge in developed countries that include five factors: management ownership, ownership, the board size, asymmetry of information, debt agreements using financial data for the period 2006 to 2015 from 11 Iraqi banks for 110 observations. It examines the impact of various corporate determinants on the Value Relevance of Accounting Information. The testing model for this study's hypothesis test is based on the Ohlson model, which has been used in several previous studies for the stock Value Relevance test. As a consequence of the analytical study, accounting earnings are used by participants in the stock market as valuable knowledge as a measure of the banks' financial performance. The findings show that the Value Relevance of accounting revenue is influenced by all five financial reporting determinants proposed in this article. This study indicates that if consumers and financial institutions regard these financial reporting determinants as conditions for leaving the financial reporting pattern in Iraqi firms, they would be able to make reasonable decisions. The contribution of this analysis is to indicate that the determinants of financial reporting may be a valuable predictor for assessing if a corporation is exploiting its accounting records in response to the criteria of external consumers.