A master’s thesis submitted to the Council of the College of Administration and Economics – University of Karbala, as part of the requirements for obtaining a Master of Science in Accounting

By the student 

Murtadha Atiyah Dahham Abdullah Alradhi 

Supervised by

Asst. Prof. Dr.Azher Subhi Abdulhussein Aljeboori

This research aims to measure the impact of the priority of implementing regulatory controls in reducing risks and its reflection on the quality of financial reports, in the context of the Iraqi banking sector. The research community represented all Iraqi banks listed on the Iraq Stock Exchange (ISX). A sample of ten banks was selected, namely (Bank of Baghdad, Middle East Investment Bank, Iraqi Investment Bank, National Bank of Iraq, Babylon Bank, Gulf Commercial Bank, Ashur International Investment Bank, Dijlah and Euphrates Bank for Development and Investment, Mansour Investment Bank, International Development Bank for Investment and Finance). The questionnaire was distributed to them, and consisted of three axes. The first axis dealt with the priority of application of regulatory controls and included (45) paragraphs distributed over (3) dimensions, namely (the benefit of regulatory controls, the cost of regulatory controls, and the inherent restrictions of regulatory controls). The first and second dimensions each had (16) paragraphs, while the third dimension had (13) paragraphs. The second axis dealt with reducing risks and included (41) paragraphs. It was distributed across (2) dimensions: (the impact and likelihood of risks, and risk appetite). The first dimension accounted for (21) items, while the second dimension accounted for (20). The third axis addressed the quality of financial reports and included (18) items distributed across (3) dimensions: (the quality of accounting information, the quality of earnings, and accounting conservatism). Each dimension had (6) items. The number of survey participants was (125) employees. The SPSS V.23 program was used to analyze the data.

The research reached several conclusions, the most important of which is that prioritizing the implementation of regulatory controls plays a significant role in reducing risks, and this impact is positively reflected in the quality of financial reports. In light of the conclusions, the research presented several recommendations, the most important of which is conducting a periodic evaluation of regulatory controls using systematic analytical tools, including the controls analysis matrix, to determine the priority of their implementation to ensure their effectiveness, suitability, and cost-efficiency.