The Effect of Accounting Conservatism in The Opinion of The External Auditor An applied study on a sample of companies listed in the Iraq Stock Exchange
Keywords:
accounting conservatism, auditor's opinion, qualified opinion, unqualified opinion.
Abstract
The investigation will assess the consequences of accounting conservatism regarding the external auditor's opinion, assuming that there is a significant statistical effect of accounting conservatism on the opinion of the external sector. auditor regarding the companies listed on the Iraqi stock exchange. Of the companies in the Iraqi stock exchange that are listed and have a number of (13) sectors, from 2011-2018, as the Beaver and Ryan (2000) model was employed, the relationship between market value and book value was used to measure the degree of accounting conservatism. and the multiple regression model was adopted in the (SSPS) program for extracting results, which indicated that there is a statistically significant effect of accounting conservatism in the type of external auditor’s opinion, meaning that companies that committed to a level of accounting conservatism received an unqualified audit opinion.
References
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Simamora, R. A., & Hendarjatno, H. (2019). The effects of audit client tenure, audit lag, opinion shopping, liquidity ratio, and leverage to the going concern audit opinion. Asian Journal of Accounting Research.4(1),145-156.
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Sun, S. (2019). Research on Corporate Governance Structure and Audit Opinions. In 2nd International Conference on Education Science and Social Development.542-546.
Sutrisno, P. (2019). CEO Overconfidence, Audit Firm Size, Real Earnings Management and Audit Opinion. Academy of Accounting and Financial Studies Journal, 23(1), 1-13.
Yendrawati, R., & Ghaisani, N. (2020). Determinants of Going-concern Audit Opinions Acceptance. Review of Integrative Business and Economics Research, 9 (1), 230-243.
Yunos, R. M., Ismail, Z., & Smith, M. (2012). Ethnicity and accounting conservatism: Malaysian evidence. Asian Review of Accounting. 20 (1), 34-57.
Zakia, Bin Zarrouk, (2017), The Role of Audit based on Business Risks in Supporting the Credibility of External Auditor Reports, PhD thesis, Faculty of Economics, Commercial and Management Sciences, Department of Management Sciences, Batna University, Algeria.
Zalloum, N., Al-Abadi, Haitham Mamdouh, Hashem, Firas Nael, (2014), Supporting the professional opinion of the auditor using data search techniques in predicting the existence of material errors in the financial statements, The Jordanian Journal of Business Administration, Volume 10, Issue 20, Deanship of Scientific Research, University of Jordan, Jordan.
Al-Zoba’i, S. A. H., (2010), The effect of accounting measurement restrictions in the financial statements and their reflection on the auditor’s opinion (an applied study of a sample of Iraqi joint stock companies), PhD thesis, Higher Institute of Accounting and Financial Studies, University of Baghdad, Iraq.
Awaja, H. K., (2017), Accounting Conservatism and its Impact on Evaluating the Performance of Iraqi Private Banks, Al-Qadisiyah Journal of Administrative and Economic Sciences, Volume 19, Number 1, University of Al-Qadisiyah, Iraq.
Crucean, A. C. (2019). The Information Content of Audit Opinion For Users Of Financial Statements. Oradea Journal of Business and Economics, 4(2), 91-101.
Crucean, A. C. (2019). The Information Content of Audit Opinion For Users Of Financial Statements. Oradea Journal of Business and Economics, 4(2), 91-101.
Cullinan, C. P., Wang, F., Yang, B., & Zhang, J. (2012). Audit opinion improvement and the timing of disclosure. Advances in Accounting, 28(2), 333-343.
Ghale Rudkhani, T. M., & Jabbari, H. (2014). The effect of financial ratios on auditor opinion in the companies listed on TSE. European Online Journal of Natural and Social Sciences: Proceedings, 2(3), 1363-1373.
Habib, A. (2013). A meta‐analysis of the determinants of modified audit opinion decisions. Managerial Auditing Journal.184-216.
Hamdan, A. M. M. (2020). Audit committee characteristics and earnings conservatism in banking sector: empirical study from GCC. Afro-Asian Journal of Finance and Accounting, 10(1), 1-23.
Hamdan, A.M. M., (2011), The Impact of Accounting Conservatism in Improving the Quality of Financial Reports: An Applied Study on Jordanian Public Shareholding Industrial Companies, Journal of Administrative Sciences Studies, Volume 38, Issue 2, Deanship of Scientific Research, University of Jordan. Jordan.
Hassan, I. A., (2015), The impact of the unified accounting system for municipalities on the quality of accounting information in financial reports and the opinion of the external auditor (an applied study in the Directorate of Najaf Municipality), PhD thesis, Higher Institute of Accounting and Financial Studies, University of Baghdad, Iraq .
Ibrahim, M. A., (2019), Measuring the level of accounting conservatism in financial reports and its impact on the market value of companies (an applied study on a sample of joint stock companies listed on the Iraqi Stock Exchange), Journal of the University College of Heritage, Volume 1, Issue 27, Heritage College University, Baghdad.
Jassim, M. R., (2020), The Impact of Implementing International Financial Reporting Standards (IFRS) on Accounting Conservatism, An Applied Study on a Sample of Companies Listed in the Iraq Stock Exchange, Tikrit Journal of Economic and Administrative Sciences, Volume 16, Issue 51, Tikrit, Iraq.
Kang, T., Lobo, G. J., & Wolfe, M. C. (2017). Accounting conservatism and firm growth financed by external debt: The role of debt maturity. Journal of Accounting, Auditing & Finance, 32(2), 182-208.
Liu, H., Cullinan, C. P., & Zhang, J. (2020). Modified audit opinions and debt contracting: evidence from China. Asia-Pacific Journal of Accounting & Economics, 27(2), 218-241.
Maldonado, I., Pinho, C., & Lobo, C. A. (2019). Determinant factors of external audit opinion modification in Portuguese municipalities. In 2019 14th Iberian Conference on Information Systems and Technologies (CISTI) (pp. 1-6).
MohammadRezaei, F., Mohd‐Saleh, N., Jaffar, R., & Hassan, M. S. (2016). The effects of audit market liberalisation and auditor type on audit opinions: the Iranian experience. International Journal of Auditing, 20(1), 87-100.
Mokoaleli-Mokoteli, T., & Iatridis, G. E. (2017). Big 4 auditing companies, earnings manipulation and earnings conservatism: evidence from an emerging market. Investment Management and Financial Innovations, 14(1), 35-45.
Naviantia, I. A. (2020). Audit Opinion on Government Financial Report: Evidence from Local Governments in Indonesia. International Journal of Economics & Management, 14(1). p129-144.
Omar, B.(2020). The reality of auditing in light of accounting conservatism. Journal of Economics and Human Development.University of Mascara , Algeria. 11(3). 347-359.
Pamungkas, B., Ibtida, R., & Avrian, C. (2018). Factors influencing audit opinion of the Indonesian municipal governments’ financial statements. Cogent Business & Management, 5(1).1-18.
Prihandoko, D. H., & Supriyati, S. (2020). The role of auditor opinion in moderating the effect of financial distress on auditor switching in the infrastructure, utility, and transportation sub-sectors. The Indonesian Accounting Review, 10(1), 95-104.
Saif, S. M., Sarikhani, M., & Ebrahimi, F. (2012). Finding rules for audit opinions prediction through data mining methods. Research Methods & Methodology in Accounting eJournal.28-36.
Simamora, R. A., & Hendarjatno, H. (2019). The effects of audit client tenure, audit lag, opinion shopping, liquidity ratio, and leverage to the going concern audit opinion. Asian Journal of Accounting Research.4(1),145-156.
Sisalem, R. M., (2018), The Impact of the Audit Committee’s Characteristics on the Opinion of the External Auditor (Applied Study on Banks Listed on the Palestine Stock Exchange), an unpublished Master’s thesis in Accounting, Faculty of Economics and Administrative Sciences, Islamic University, Gaza, Palestine.
Sun, S. (2019). Research on Corporate Governance Structure and Audit Opinions. In 2nd International Conference on Education Science and Social Development.542-546.
Sutrisno, P. (2019). CEO Overconfidence, Audit Firm Size, Real Earnings Management and Audit Opinion. Academy of Accounting and Financial Studies Journal, 23(1), 1-13.
Yendrawati, R., & Ghaisani, N. (2020). Determinants of Going-concern Audit Opinions Acceptance. Review of Integrative Business and Economics Research, 9 (1), 230-243.
Yunos, R. M., Ismail, Z., & Smith, M. (2012). Ethnicity and accounting conservatism: Malaysian evidence. Asian Review of Accounting. 20 (1), 34-57.
Zakia, Bin Zarrouk, (2017), The Role of Audit based on Business Risks in Supporting the Credibility of External Auditor Reports, PhD thesis, Faculty of Economics, Commercial and Management Sciences, Department of Management Sciences, Batna University, Algeria.
Zalloum, N., Al-Abadi, Haitham Mamdouh, Hashem, Firas Nael, (2014), Supporting the professional opinion of the auditor using data search techniques in predicting the existence of material errors in the financial statements, The Jordanian Journal of Business Administration, Volume 10, Issue 20, Deanship of Scientific Research, University of Jordan, Jordan.
Published
2023-11-20
How to Cite
Ehsan Fadhil Mohammed. (2023). The Effect of Accounting Conservatism in The Opinion of The External Auditor An applied study on a sample of companies listed in the Iraq Stock Exchange . Central Asian Journal of Innovations on Tourism Management and Finance, 4(11), 37-50. Retrieved from https://cajitmf.centralasianstudies.org/index.php/CAJITMF/article/view/649
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