The main target in this research is to showing the activities of Iraqi leather company in the period of 2017 to the end of 2019. Two important items in the financial statements (Inventory costs and Production costs) are used to esteem the proportional competence results of this company. These results have important producing implications to raise production and to be more successful than others companies (Haron, 2012). Iraqi leather company worked to identify the effect of profitability and financial performance on improving productive efficiency. As inventory costs and production costs, this research found that there is an important effect of the financial performance and statements on beneficent prolific efficiency in Iraqi leather company. Therefore, this company worked to developing inventory system and production system to improve productive efficiency through increasing the interest of financial statements that show the productive efficiency and financial achievement (Harb, 2019).