THE IMPACT OF EARNING MANAGEMENT, LIQUIDITY, AND EFFICIENCY ON THE COST OF EQUITY OF TOP TEN ORGANIZATIONS IN THE IRAQI STOCK EXCHANGE

Abstract

Currently, the cost of equity (CE) is a requirement for investors and businesses to thrive in the market. This may be accomplished through effective earnings management and stock efficiency. This element requires the attention of researchers and regulators. The current study evaluates the impact of earnings management, liquidity, efficiency, and return on assets (ROA) on the capitalization equivalence (CE) of the top 10 companies listed on the Iraqi stock exchange. The researchers utilized secondary data gathered from the financial accounts of the selected firms from 2012 to 2021. The researchers additionally examine the relationship between variables using the dynamic autoregressive distributed lag (DARDL) technique. The results suggested that the earning management, liquidity, efficiency, and ROA of the top 10 companies on the Iraqi stock exchange have a favorable relationship with their CE. The article directs policymakers in formulating high CE-related policies utilizing effective earnings management and stock efficiency.