A Model of the Factors Determining the Selection of Independent Auditors in Companies Listed on the Iraq Stock Exchange
Keywords:
Auditor independence, Iraq Stock Exchange, grounded theory, structural model, information transparency, regulatory institutionsAbstract
The selection of an independent auditor is one of the most important corporate governance decisions and can influence the quality of financial reporting, investor confidence, and capital market efficiency. Accordingly, the present study aimed to develop a comprehensive model of the factors determining the selection of independent auditors in companies listed on the Iraq Stock Exchange. In terms of purpose, this research was applied, and in terms of methodological approach, it was qualitative. The participant population consisted of financial managers of companies listed on the Iraq Stock Exchange. Using purposive sampling and continuing until theoretical saturation was achieved, 15 participants were selected. Data were collected through semi-structured interviews and analyzed using Colaizzi’s seven-step method. To enhance the trustworthiness of the findings, Guba and Lincoln’s criteria of credibility, confirmability, transferability, and dependability were applied. The data analysis resulted in the identification of 11 main dimensions: the regulatory and legal framework, professional credibility and standing, technical and specialist competence, performance and reporting quality, economic considerations, governance of the selection process, behavioral and relational factors, technological capabilities, risk management, the market and competitive environment, and the sustainability of professional relationships. These dimensions were organized into four fundamental clusters: legal and professional factors, quality and performance factors, behavioral and relational factors, and technological and environmental factors. The findings indicated that compliance with legal requirements, professional independence and credibility, technical expertise, audit service quality, risk management, the use of emerging technologies, and the development of sustainable professional relationships were the most important components influencing the selection of independent auditors in the Iraqi capital market. The proposed model demonstrates that independent auditor selection is a multidimensional and strategic process that is not based solely on financial and cost-related criteria; rather, it incorporates a combination of legal requirements, professional capabilities, service quality, corporate governance, technology, competitive market conditions, and professional trust.
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Copyright (c) 2025 Nihad Al-Shamsawee (Author); Javad Rezazade; Sahar Sepasi (Author)
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