WSEAS Transactions on Business and Economics | 2026
Authors: Yassen A.R.; Jasim M.R.
DOI: 10.37394/23207.2026.23.48
Journal: WSEAS Transactions on Business and Economics
Year: 2026
Publisher: World Scientific and Engineering Academy and Society
Document Type: Article
Open Access: All Open Access; Gold Open Access
Cited by: 0
This research aims to test the effect of financial statement comparability on the cost of equity capital of the company, and whether there are differences in this relationship that can be attributed to the level of managerial ability of executive managers. The study sample consisted of 24 companies listed on the Iraq Stock Exchange for the period from 2010 to 2024, with a total of 360 observations (firm/year). The results of the analysis indicate that financial statement comparability has a negative and statistically significant effect on the cost of equity capital, such that high comparability reduces the information risk faced by investors, and consequently reduces their required rate of return. Meanwhile, there was no statistically significant effect of managerial ability on the relationship between comparability and the cost of equity capital. This may be attributed to the low level of financial and accounting expertise of corporate management and their lack of effective involvement in accounting work, which weakens the element of accountability that could be enhanced by managerial ability. © 2026, World Scientific and Engineering Academy and Society. All rights reserved.
Cost Equity Capital; Financial Leverage; Financial Statement Comparability; Firm Size; Managerial Ability; Return on Assets