The impact of comparability of financial statements on the efficiency of institutional investment: an applied study in a sample of Iraqi banks
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Abstract
This research aims to provide an indicator of the level of comparability in banks listed on the Iraq Stock Exchange, as well as to demonstrate its impact on investment efficiency. Since the level of comparability is linked to the decisions of users of accounting information, it has the most significant impact on institutional investment efficiency. To achieve this objective, 13 banks listed on the Iraq Stock Exchange were selected, covering the study period of (10) years (2014-2023). The De Franco et al. (2011) model was adopted. The study concluded that there is a positive impact of comparability on the direction of investment efficiency towards optimal investment. This is confirmed by the increased overall impact on investment efficiency through the increase in the direct and indirect effects of comparability. The research recommends the necessity of establishing mechanisms in banks listed on the Iraq Stock Exchange that would enable comparability by presenting profits, distributions, and returns within a specific item in market reports. It also recommends conducting further future research on periods that were characterized by weak comparability in the banking sector and studying the variables associated with it and the mechanisms for proposed solutions.
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