THE IMPACT OF AN AUDITOR'S ADHERENCE TO THE PRINCIPLES OF NEUTRALITY, PROFESSIONAL INDEPENDENCE, PROFESSIONAL CONFIDENTIALITY, AND TRUST IN THE TAX ACCOUNTING PROCESS

Abstract

Objective: This study aims to demonstrate the impact of the auditor's adherence to the principles of neutrality, professional independence, confidentiality and trust in the tax accounting process and the importance of this commitment to the tax administration. The study also examines the extent to which the tax administration relies on the auditor's report and financial statements in determining the taxable income of taxpayers.
 
 Methodology: The study's objectives were achieved by collecting data from a survey distributed to certified auditors working for the Iraqi Board of Accountancy and Audit, employees of the Federal Financial Control Bureau, and employees of the General Tax Authority. A total of 230 questionnaires were distributed, 200 of which were returned and verified for statistical analysis.
 
 Results: The results indicate a statistically significant positive effect at the 5% level for the impact of neutrality and professional independence on the tax accounting process. This means that an increased focus on auditor neutrality and independence will contribute to a 0.469 increase in the efficiency of the tax accounting process. In addition, there is a positive and statistically significant moral impact below the 5% level for the impact of professional duty of confidentiality and trust in the tax accounting process. In other words, ensuring auditors follow the rule of professional confidentiality and trust can improve tax accounting efficiency by 0.350.
 
 Conclusion: Professional ethics and codes of conduct serve as guides for auditors to exhibit appropriate professional behavior while performing their duties to meet society's ethical requirements. The professional code of ethics is the outcome of the profession's efforts to develop and organize rules. It assures the tax administration that the financial statements submitted by the taxpayer (companies) and approved by the auditor who adheres to those rules are truthful and fair.