The Value Relevance of Accounting Information in Iraq

Abstract

The paper tests the value relevance of accounting information extracted from financial statements of 15 Iraqi companies listed on the Iraq Stock Exchange (ISX) for period 2010–2020. The relationships among accounting information (measured as earnings, book value, and cash flows) and company value (measured as stock prices) have been analyzed via descriptive statistics, correlation and regression. It is found that all these relationships are positive and significant in different levels. Compared with book value, earnings have the highest influence on stock price, while cash flows have the lowest influence on stock price. This study participates in the understanding of value relevance of accounting information in ISX as an emerging market and presenting peer insights to enhance the financial reporting standards in this country and in other similar countries in Middle East region.