Financial statements’ reliability affects firms’ performance: A case of Vietnam

• Published in: Journal of Eastern European and Central Asian research Vol. 11; no. 1; pp. 143 - 155
• Main Authors: Kim Quoc, Trung Nguyen, Tran Hong, Van, Le Van, Tuan, Minh, Hang Nguyen, Nguyen Thi Ngoc, Oanh
• Format: Journal Article
• Language: English
• Published: Minneapolis The Institute of Eastern Europe and Central Asia 01-02-2024; IEECA
• Subjects: Accountability; agency theory; Asymmetry; Audit committees; Auditing; Boards of directors; Companies; Corporate governance; Decision making; Financial statements; firm performance; Information systems; International accounting standards; International Financial Reporting Standards; Investments; Investors; Marketing; Quantitative analysis; Reliability; stakeholder theory; Stakeholders; Stock exchanges; Stockholders; Vietnam
• ISSN: 2328-8272; 2328-8280
• DOI: 10.15549/jeecar.v11i1.1432

This paper aims to estimate the effect of the reliability of financial statements on listed firms’ performance in Vietnam, especially on the Ho Chi Minh City Stock Exchange, from 2015 to 2022. Based on International Financial Reporting Standards, Generally Accepted Accounting Principles and theories, reliability is a key attribute of information quality in financial statements. Besides, using the quantitative method of feasible generalized least squares (FGLS), the findings show that reliability positively affects listed firms’ performance with a confidence interval of 95%. On the platform of agency theory, the reliability of financial statements is considered a tool to fulfill the duties and responsibilities of managers and the board of directors to external users, while stakeholder theory considers the advantages of the disclosure of reliable financial statements in terms of gaining performance.