The effect of financial crisis on the relationship between accounting quality and trade credit in Iraqi listed firms

الملخص EN

the main aim of this study is to evaluate the relationship between accounting quality and trade credit during financial crisis.

In this research, the dependent variable is trade credit, which is accounts payable divided by total assets (Petersen&Rajan, 1997; Giannetti et al.

, 2011; Ke, 2015).

The independent variable is accounting quality, which is calculated by three indicators, including profit sustainability, profit predictability as well as real earnings management, for which we used Kormendi&Lipe (1987), Francies et al.

(2004) and Roychowdhury (2006) models respectively.

The data is based on a sample of 35 firms from 2011 to 2016.

During this period, between 2011 and 2013 we have financial crisis – ISIS entered Iraq – and between 2014 and 2016 we have the period after the crisis.

Our hypotheses are run by panel data on STATA14 software.

The results show that the moderating effect of the financial crisis does not impact the relationship between profit sustainabilityand trade credit, but has a significant-negative impact on the relationship between profit predictability and trade credit; the moderating effect of financial crisis on the relationship between real earnings management and trade credit is not significant.