Abstract
This study aims to test the extent to which Iraqi banks practice accounting conservatism, and measure their profit management practices, in addition to testing the relationship between accounting conservatism and profit management, by applying to a sample of 15 banks that constitute about 80% of the total Iraqi private banks listed in the Iraq Stock Exchange. For the years 2014 and 2015. The model (miller) was relied on to measure profit management practices, and the book value to market value model was used to measure the accounting conservatism. A set of statistical methods were used to analyze the data and reach the results, such as the Pearson correlation coefficient test, the coefficient of variance analysis, the arithmetic mean, and the standard deviation, using the SPSS statistical program. The results showed that all banks in the study sample had used accounting conservatism in varying proportions, as well as that they had practiced profit management, except for the Bank (Baghdad). And that there is an inverse relationship between the use of accounting conservatism and the practice of profit management, as accounting conservatism contributes to limiting profit management, which contributes to increasing investor confidence and encouraging them to invest and thus promoting sustainable development. The study recommends the necessity of educating users of financial reports in general, and lenders and investors in particular, of the dangers and effects of the practice of profit management in their economic decisions, and its role in the spread of manipulation and opportunistic practices, through the establishment of media programs, courses and educational seminars. And the necessity for the external auditors to adopt one of the indicators for measuring the accounting conservatism in the statements they audit, and the necessity to include in their audit reports a paragraph that includes measuring the level of accounting conservatism in the financial statements of the banks they have audited.
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