Academy of Accounting and Financial Studies Journal (Print ISSN: 1096-3685; Online ISSN: 1528-2635)

Abstract

The Role of Forensic Accounting and Its Relationship with Taxation System in Iraq

Author(s): Ahmed Mahdi Hadi, Ahmed Rahi Abed, Hayder Oudah Kadim

The objective of this study was to investigate the role of forensic accounting in restraining the tax evasion in Iraq particularly when the country is facing severe political unrest and military operations. The study also examined how forensic accounting could be ideally suitable for the current state of Iraqi economy which is facing a transition from oil economy to a tax-based economy, using the ransom sampling method to identify 60 government and semi government tax officials, the study adopted a survey technique. The study encountered a number of important findings regarding the role of forensic accounting in introducing a robust taxation system in Iraq. The study examined the role played by forensic accounting system in bringing tax reforms in the Iraqi context. This study also analyzed the current tax system in Iraq to shed light on key weaknesses and provide proposals for reform and revenue mobilization. The major findings of the study include a necessity of the application of forensic accounting in introducing tax reforms in Iraq. The study recommended that all legal institutions and government agencies should establish forensic accounting units. Educational institutions and universities should also include modules on forensic accounting in their curriculum. It also recommends simplifying direct taxes, increasing non-oil revenues from indirect taxation, and strengthening tax and customs administrations. The study will prove to be a contribution to the Iraqi public accounting practices.