The Impact of Audit Committee Members’ Independence and Financial & Accounting Expertise on the Relevance and Value of Financial Information

In addition to the key findings, the study also emphasizes the importance of fostering a deeper understanding of the role of audit committees within the broader context of financial governance. Despite the recognition of the audit committee’s importance in improving the quality of financial reporting, the findings indicate that there is a significant gap in the implementation of best practices across private commercial banks in Iraq. This gap is attributed to the lack of full compliance with regulatory requirements regarding the composition of audit committees, particularly in terms of ensuring independence and financial expertise. The study further reveals that while the audit committee's independence and expertise play a crucial role in enhancing the quality and relevance of financial information, many banks still struggle to implement effective oversight mechanisms. This situation is exacerbated by the complex regulatory environment in Iraq, where overlapping supervisory authorities and weak enforcement of governance mechanisms hinder the effectiveness of financial reporting processes. The lack of coordination between audit committees and internal audit units, as well as the limited ability to assess financial performance, further undermines the oversight function of audit committees. To address these challenges, the study suggests several recommendations, including enhancing the legal framework to enforce stricter compliance with the formation of qualified and independent audit committees. Additionally, increasing awareness and training among stakeholders about the importance of audit committees and their roles in ensuring transparent and reliable financial disclosures is crucial. Strengthening the oversight function and improving coordination between audit committees and internal audit units will also help in mitigating the existing weaknesses in the financial reporting process. These steps are essential for improving the reliability of financial information, thereby fostering investor confidence and contributing to the overall stability of the banking sector in Iraq.