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Perceived Audit Quality, Earnings Management and Cost of Debt Capital: Evidence from the Energy Listed Firms on Vietnam s Stock Market

Author

Listed:
  • Phung Anh Thu

    (Faculty of Finance and Accounting, Nguyen Tat Thanh University, Ho Chi Minh City, Vietnam)

  • Thai Hong Thuy Khanh

    (Faculty of Finance and Accounting, Nguyen Tat Thanh University, Ho Chi Minh City, Vietnam)

  • Nguyen Tran Thai Ha

    (Faculty of Finance and Accounting, Saigon University, Vietnam,)

  • Nguyen Vinh Khuong

    (University of Economics and Law, Vietnam National University, Ho Chi Minh City, Vietnam)

Abstract

This study examines the impact of perceived audit quality and accrual-based earnings management on cost of debt capital of the energy listed firms on Vietnam s stock market. Our data set includes 29 energy companies on Vietnam stock markets (HNX and HOSE) in the period from 2010 to 2016. We used FEM and REM estimator to test our hypotheses. The results confirm that there is no significant statistical association between accrual-based earnings management and cost of debt. There is a negative association between audit quality, firm size, return on assets and cost of debt while firm leverage and the tangible asset has a positive association. Moreover, global financial crisis has no statistically significant influence on the cost of debt capital. The research results have implications for regulators and investors about the stability of the economy in emerging markets.

Suggested Citation

  • Phung Anh Thu & Thai Hong Thuy Khanh & Nguyen Tran Thai Ha & Nguyen Vinh Khuong, 2018. "Perceived Audit Quality, Earnings Management and Cost of Debt Capital: Evidence from the Energy Listed Firms on Vietnam s Stock Market," International Journal of Energy Economics and Policy, Econjournals, vol. 8(6), pages 120-127.
    • Handle: RePEc:eco:journ2:2018-06-15
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    References listed on IDEAS

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    Cited by:

    1. Nguyen Vinh Khuong & Nguyen Tran Thai Ha & Phung Anh Thu, 2019. "The Relationship between Real Earnings Management and Firm Performance: The Case of Energy Firms in Vietnam," International Journal of Energy Economics and Policy, Econjournals, vol. 9(2), pages 307-314.
    2. Marko Milojević & Mariusz Urbański & Ivica Terzić & Valeriy Prasolov, 2020. "Impact of Non-Financial Factors on the Effectiveness of Audits in Energy Companies," Energies, MDPI, vol. 13(23), pages 1-17, November.

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    More about this item

    Keywords

    cost of debt; earnings management; audit quality; energy enterprises; Vietnam.;
    All these keywords.

    JEL classification:

    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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