Proceedings of International Conference on Applied Innovation in IT  ·  2026/03/31  ·  Vol. 14  ·  Issue 1  ·  pp. 1655–1661
Managerial Overconfidence and Accounting Information System Quality: Evidence from Iraqi Banks
Muthana Rokan Jasim and Anmar Ahmed Khalaf
📄 Download PDF DOI: 10.25673/123789
Abstract
This study investigates the impact of managerial overconfidence on the quality of accounting information systems, with a focus on financial reporting quality in the banking sector. Using panel data from ten banks listed on the Iraq Stock Exchange over the period 2010–2023, the study employs regression analysis to examine the relationship between managerial behavioral bias and earnings quality indicators. Managerial overconfidence is proxied by asset growth and sales growth, while accounting information quality is assessed through accruals quality and earnings persistence. The empirical results reveal a statistically significant negative effect of managerial overconfidence on accruals quality, indicating a higher likelihood of earnings management practices. However, no significant relationship is found between managerial overconfidence and earnings persistence. These findings highlight the importance of addressing behavioral biases in managerial decision-making, as they can undermine the reliability of accounting information systems. The study contributes to the literature by providing evidence from an emerging market context and offers practical implications for improving financial reporting quality and governance mechanisms in banking institutions.
Keywords
Managerial Overconfidence Accrual Quality Earnings Persistence.
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